Credit today often feels like an exclusive club: you need the right score, connections, or socio-economic class just to get the door open. But what if, instead of some arbitrary privilege, credit worked like an open protocol, a transparent, permissionless network anyone could plug into? Imagine instead of your FICO number deciding your fate, your entire financial history lived on a blockchain ledger. This isn’t sci-fi. Visionaries like the blockchain startup Gluwa are turning this idea into reality, especially in emerging markets. The promise of “credit as code” open, global, and programmable could unlock capital for the 1.4 billion unbanked people on Earth. We stand at a crossroads: keep credit as a gated privilege, or evolve it into an inclusive protocol. I’m betting on the latter. The Privilege Trap Let's be real: the conventional credit system is rigged by design. It functions for those in the know and against all others. As Federal Reserve researchers have characterized it, "the credit scoring system may actually perpetuate" socio-economic inequalities by bestowing "benefits and advantages to individuals who come from more privileged backgrounds.". In practice, that means if you’re young, poor or from a developing country you’re more likely to have low scores and higher rates even if you’re a good borrower. In the US being Black or Hispanic makes it way harder to get a good score, meaning higher interest or denial. Globally, it's even worse: in Africa only 20-30% of people have a formal credit score at all, rendering the rest "invisible" to lenders. And tens of millions of micro-entrepreneurs are operating cash-and-handshake. Federal Reserve researchers This old paradigm renders credit a privilege not a right. Banks extend loans predicated on credit histories locked in siloed ledgers, so new entrants or the unbanked don't even exist. Estimates suggest over 1.4 billion people worldwide lack access to a bank account, microloan or even digital wallet. This exclusion traps entire communities in poverty: unable to prove your creditworthiness to the gatekeepers, you can't invest, build a business or accumulate wealth. In our financial "castle" only those with the right handshake or birthright lineage can approach the lender and ask for gold. If credit is allowed to remain this gatekept privilege, billions will remain excluded. Credit as Protocol: An Open, Decentralized Network What if credit were as much like the Internet as possible? An open protocol, not a password club. On this vision, credit histories and scores are public books, governed by smart contracts and accessible to anyone with an identity and an Internet connection. Just as anyone can send data over TCP/IP, anyone can request a loan based on verifiable on-chain data. Web3 entrepreneurs are already drawing this vision. For example, Creditcoin is a blockchain (Substrate-based) that is specifically designed to record and settle credit transactions. Instead of collateral, it is based on a borrower's record. In a decentralized credit system, your reputation is tied to transparent data, your payments for bills, microloans or even tokenized bills, not dark corporate ratings. Think of a Nairobi trader or Brazilian farmer who never had an account but built an on-chain record of tiny loans and repayment. A global market of lenders could instantly look up her reputation from that record. Even cross-border lending is easy: credit profiles accompany you overseas (there would not be a single bank in Lagos that holds your score). Effectively, credit is rendered permissionless, global and compositional, just as email or digital identity. In short, credit as protocol turns a historic right into a publicly available good. Gluwa’s Vision: Redefining Credit for Everyone At the forefront of the transformation is Gluwa, a blockchain fintech innovator. Gluwa's strongest claim to fame is developing public blockchains for credit: Creditcoin (also commonly known as "the credit blockchain") and its Credal system. These are essentially designed to capture loan performance and credit history on-chain. The idea: lenders and borrowers interact directly with smart contracts instead of dark bureaus. Gluwa CEO Tae Oh even commands the Creditcoin network, a Layer-1 blockchain that "makes a public ledger of credit history and on-chain loan performance.". What does it look like in practice? For emerging economies, Gluwa is linking the dots between cryptocurrencies and real-world loans. In Nigeria, for instance, Gluwa partnered with the central bank to merge its Credal blockchain with the nation's new eNaira CBDC. Under a 2024 deal, the CBN will grant APIs to Gluwa so fintech lenders can tap Credal along with the eNaira. The result is real-world: Credal creates on-blockchain "credit reputations" for shoppers so lenders can originate, track and close loans with historic ease. Someone with no banking history can take advantage of a blockchain credit score to borrow. And it's at scale. Gluwa has its Credal network that made over 4.27 million loan transactions (worth ~$80 million) and engaged over 337,000 users. All these loans were to the unbanked and underbanked who the prior system woefully fails. By moving credit data away from the vaults of traditional banks and onto a public blockchain, Gluwa is overcoming the limitations of traditional credit: it is accessible to everyone who has a wallet and accounts can (pseudo-)anonymously open up global finance. Gluwa's own words, their system is creating a "borderless financial ecosystem", bringing into play those who were excluded before through offering them tradable, cross-border credit histories. In short, Gluwa is credit coding. Your borrowing record is information that you own, a tokenized history rather than a file number owned by a bank. No middlemen gatekeepers, just a programmable ledger. Nigeria’s eNaira Case Study: Blockchain Meets Credit Nigeria's foray into a digital naira shows quite how significant an impact that can be. Nigeria launched the eNaira in 2021 to enhance inclusion. Take-up was terrible: by mid-2023, fewer than 1% of Nigerians with bank accounts held an eNaira wallet and only 1.5% of the wallets were funded. Governments learned: issuing a digital currency is one thing, getting people to use it is a very different story. And Gluwa's Credal came to fill the void. As reported by Cointelegraph, "the Central Bank of Nigeria (CBN) has signed a memorandum of understanding with Gluwa Nigeria to encourage eNaira adoption". In practical terms, this means that any Nigerian eNaira wallet owner can create a blockchain-based credit score using Credal. CBN designers are optimistic this will "simplify loan origination, management, settlement and credit assessment" for local fintechs. That is, they're turning eNaira into a credit-building tool instead of a payment token. No token movement. Gluwa's team contends that historical credit data is "stuck" in banks, excluding millions. Credal's public blockchain will "build credit reputations for eNaira users," that is, Nigerians who never, ever had a FICO score can now build an on-chain reputation that foreign investors can trust. It's a creative twist: instead of lamenting the lack of eNaira users, the CBN has given Gluwa's blockchain protocol the leeway to use credit as the incentive to drive adoption. Early figures are compelling. From late 2022 to early 2023, eNaira wallets grew over 12x (1.1 million to 13 million) and volume on transactions grew 63%. Some of the success, Gluwa credits to Credal linked products: microloans or mobile loans extended via eNaira/Credal. If credit is now so "mintable" for users, then more users are coming to utilize the currency just to establish that reputation. It's a community-level rediscovery of eNaira, one loan at a time. 1.1 million A Global Frontier: Decentralized Credit Beyond Banks Nigeria is just the start. Imagine this model everywhere: every country’s digital finance (or even cash-based finance) powered by open credit protocols. In Pakistan, telecom-led banks have already done something similar offline; in crypto-land, DeFi credit protocols serve poor borrowers in Latin America, Africa and Asia. Gluwa is positioning itself to be the infrastructure on which all these ride. Its Creditcoin framework is all about tokenizing loans as real-world assets and linking them to capital markets. Credit-as-protocol can also plug back into traditional banks in a hybrid model. Yes, we dream of decentralized, open credit. But realistically, incumbent financial institutions won’t disappear overnight. Instead, they might integrate with these blockchains: a bank could “bridge” its own loan books onto Gluwa’s ledger, or issue digital credit lines anchored to on-chain scores. Gluwa’s blockchain APIs already allow fintechs to issue loans in local currency or stablecoins, settling on-chain. Over time, even big banks may prefer verifying blockchain credit histories rather than relying on opaque score reports. There are challenges: borrowers and lenders must trust the tech, regulators need education, and networks need liquidity. But the path is clear. Today’s privilege-based credit system is a relic of 20th-century finance. Tomorrow’s world will have interoperable, blockchain-backed credit where an honest track record, not ethnicity or zip code, gets the loan. As Gluwa’s recent deals show, this future is already happening: debt is being coded on the chain instead of file cabinets. Conclusion Turning credit from a privilege into a protocol isn’t just idealism; it’s a reality. Gluwa is proof that blockchain can deliver on crypto’s promise: lower barriers not higher ones. By publishing credit histories on an open ledger, we empower lenders and borrowers globally not to gatekeep. It may take years for this to mature but the wiring is being laid now. And with each partnership from Nigeria’s CBDC to fintechs in Ghana, Sierra Leone and beyond, we’re rewriting the rules. In a world where credit is a protocol, your financial identity travels with you, your reputation is earned, not inherited and even a small-time shopkeeper or rural farmer can access global capital. That’s a world where saying yes to someone’s loan is as easy as plugging into a network, not ticking a privileged checkbox. Buckle up guys; the privilege is ending and the protocol is just getting started.

The is an opinion piece based on the author’s POV and does not necessarily reflect the views of HackerNoon.

This story contains AI-generated text. The author has used AI either for research, to generate outlines, or write the text itself. 

What If Credit Wasn’t a Privilege, but a Protocol?

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