Author Topic: A way to mass adoption: consumer credit  (Read 187 times)

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Offline PetterJhon

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A way to mass adoption: consumer credit
« on: July 05, 2019, 06:04:05 am »
Hello everyone,,
Many people shop with credit cards. Banks issue credit to customers and customers use this credit to shop in different stores. Consumer credit boosts sales. With a minor modification, blockchain like bitshares could be used by merchants to issue credit to customers directly, without no middle men.
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Every merchant can identify credit worthy customers. Suppose, such a customer wants to buy a smart phone. The merchant can lean the customer into buying a higher end model by offering a postponed payment. Suppose, the phone costs $500. The merchant gives the phone to customer and issues 500 credit tokens (CRED). The customer  gets the phone and -500 CRED on his balance. The merchant gets +500 CRED which he can sell on DEX for 500 USD. At this point the merchant is even: he gave away one phone and received 500 USD. The CRED has value, because it can be used to buy merchandise from the merchant's shop, and many people would prefer to keep their savings in CRED instead of bank saving account. To pay off his debt and to be able to shop again, the customer needs to buy back the CRED on the market. This removes the CRED from circulation and also insures that they have value.

This is a win-win-win situation. A customer who gets a credit is happy, because he doesn't need to pay upfront, and he doesn't need to pay high interest (perhaps, no interest at all). A merchant is also happy, because postponed payments increases sales of higher end merchandise, and he doesn't need to pay fees to VISA, and he fully controls how much credit he issues, interest rates, prices etc. CRED holders are also happy, because they have a highly liquid asset backed by real merchandise, which preserves its value over time as long as the merchant who issued them is doing good.

Please, discuss.
« Last Edit: July 06, 2019, 03:53:00 pm by PetterJhon »

Online Thul3

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Re: A way to mass adoption: consumer credit
« Reply #1 on: July 05, 2019, 07:16:51 am »
Who is going to collect the debt or open lawsuites :)

Offline bitstopia2049

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Re: A way to mass adoption: consumer credit
« Reply #2 on: July 06, 2019, 01:15:23 am »

 CRED holders are also happy, because they have a highly liquid asset backed by real merchandise, which preserves its value over time as long as the merchant who issued them is doing good.

Please, discuss.

That is a big "IF"...in the age of AMAZON..!

Feasible idea...but why not just use bitUSD or bitXXX?     If the merchant uses "CRED" token then the liquidity of the token is limited to a market of interested buyers (and hodlers) of that token whereas bitUSD has no such boundaries... ( e.g  CRED token could be issued by a seller of children's clothing, which would be attractive to parents..but not so much childless couples/singles)

Also it's less work for the merchant  -- who would not have the additional admininstrative task of managing the issuance of a UIA and monitoring the amount in circulation..{because regardless of who owns the token..it still represents a liability - i.e. it is a potential claim on the merchants inventory.

He can issue "store credit" to his best customers (or their referrals) based on their reputations or a customized scoring system..
This way the only admin task for the merchant is to keep up a "reasonable" MCR for the volume of bitUSD issued as credit...

When the customer is ready to payoff the debt they can use their wallet to send bitUSD to the Merchant's account or even if they wanted to payoff (fully or partially) the debt in cash...the customer could use a mobile wallet like BiTSy
https://steemit.com/bitshares/@kencode/goodbye-middlemen-become-your-own-central-bank

Merchants could use a just-in-time method of inventory management -  Only order items from the manufacturer or distributor to meet customer specific demand. It may take a few extra days to deliver (or pick up) but the customer would be willing to wait if they are acquiring the items without need for cash...i.e tradeoff speed of availability for financial credit.. Merchant could then use cash/lines of credit, that would otherwise be tied up in a warehouse as inventory, in treasury operations so as to
produce more bitUSD and make it available to then issue more credit to customers..

Merchant could even advertise a "crypto lay away" plan......e,g..Customers can buy up to $500 worth of merchandise with bitUSD credit...and then payoff the debt "interest free" at say at $50 or 100 per month...

I'm sure there are lots of marketing ideas that could work, but the bottom line is that the merchant company would only have to buy BTS  if they want to issue credit....{they could even borrow fiat from their bank and purchase BTS directly via the Wirex platform}...And of course the upside is when BTS price rises the merchant can earn a profit and also offset any interest paid...Whereas with a CRED token the price could be quite volatile and even lose a substantial amount of it's value in the open market if there is limited liquidity...and end up with a bunch of unhappy hodlers/customers...!


Offline bitstopia2049

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Re: A way to mass adoption: consumer credit
« Reply #3 on: July 12, 2019, 05:53:19 pm »
Please, discuss.

https://bitsharestalk.org/index.php?topic=27733.msg332390#msg332390

https://www.cryptoglobe.com/latest/2019/07/australians-hooked-up-to-pay-for-groceries-with-bitcoin/


Bitshares needs to focus marketing on the basic use for bitUSD, bitCNY, bitXXX


Mass adoption >> regular people>> need Food, Shelter, Clothing>>>>>>>>> after that comes Galaxy S10 & iPhone 8