04:40 <stellar-slack> <kjn311> Well there should be rules...I know we want to be crypto purest and all but in reality...

04:41 <stellar-slack> <sacarlson> on the side of the gateway you can add as many rules as you wish

05:05 <stellar-slack> <kjn311> Fair enough. Let me ask this, not directed at anyone particular,lets say in the distant future XLM was interledger enabled. How would XLM transact in a world that requires kyc/aml? How can the billions of unbanked join the rest of the world without kyc? They would still be excluded. Right?

05:06 <stellar-slack> <sacarlson> good point

05:08 <stellar-slack> <sacarlson> but if you restricted you assets in gateways that followed the KYC standards that you desire or require you should have no problem.

05:09 <stellar-slack> <sacarlson> so some may be restricted from holding mass assets in XLM as a holder of value

05:17 <stellar-slack> <kjn311> Don't think stellar can or will raise standards as they seem to focus on countries whom citizens have little to no legal documentation. But that is an assumption, I maybe wrong.

05:19 <stellar-slack> <sacarlson> as is the case for small money governments don't care to follow it. so I see XLM more as small money in your pocket, without any restricts so I can go to a coke machine and buy a coke with it

05:23 <stellar-slack> <sacarlson> for big money put it in a trusted gateway like the Wells Fargo bank and trust gateway (fictional gateway)

05:34 <stellar-slack> <kjn311> We will see

16:43 <stellar-slack> <kjn311> so what's Stellar's end game? Bank the unbank? How is stellar providing financial services for micro finance? Is it an effort to make micro finance institutions more efficient in hopes the savings is passed to the people?

17:00 <stellar-slack> <kjn311> I'm reading most micro finance loans have an interest rate of 35% to 70%. How do you fix that?

17:10 <stellar-slack> <scott> I’m not at all well versed in this, but I remember having been told one of the reasons for 35% to 70% interest is a lack of any credit history systems for people who use these loans. Stellar, for example, could help with that since the ledger is public.

17:38 <stellar-slack> <eva> @kjn311: hi there. RE: microfinance interest rates, would you mind sharing where you found those stats? That sounds a bit high. But yes, there are multiple factors that go into an interest rate. One is a lack of credit history, as Scott mentioned, which stellar can help with. There’s also a higher cost of serving people when the software an institution uses is outdated. For instance, right now microfinance institu

17:38 <stellar-slack> cash on a 9 hour bus ride to transact with other MFI’s. If those internal software costs could be brought down, they could serve people more effectively.

17:41 <stellar-slack> <eva> Also, I think it’s important to note that one of the benefits of the Stellar network is that it works at a hyper-local level; that is, people living on $2 a day don’t need to follow the same rules or use the same services that a banked person in the United States would. That flexibility is a big part of why it has the potential to change the way money works all over the world.

17:41 <stellar-slack> <eva> As to http://Stellar.org|Stellar.org’s mission, we want to provide the infrastructure that enables free or low-cost financial services for all.

17:41 <stellar-slack> <eva> And people don’t need to use XLM - they can use their local currency, or any other asset for that matter.

18:29 <stellar-slack> <kjn311> "Typical interest rates are in the range of 2 to 4% per month which can lead to annualised interest rates in the range of 20 to 80%, depending on the scheme"

18:29 <stellar-slack> <kjn311> http://www.responsability.com/funding/data/docs/en/1563/Disscussion-Paper-Microfinance-works.pdf

18:36 <stellar-slack> <sonkarmanish> eva just wondering you mentioned stellar can play a role in helping MFIs to provide loans to the people with no credit history... just wondering if you could elaborate on it a bit.

20:54 <stellar-slack> <eva> @kjn311: got it. Right, so even in this paper they specify one of the key reasons: "Providing financial services to poor people is quite expensive, especially in relation to the size of the transactions involved.” So Stellar makes it such that a small transaction - say, ten cents - is still feasible. Because the fees on transactions are so incredibly small, these “microtransaactions” are now possible.

20:55 <stellar-slack> <eva> @sonkarmanish: hello! Good to see you in here :) RE: MFI’s and credit history, there are a lot of reasons why an MFI might have trouble extending credit to underserved people. I actually gave a talk on it recently: https://www.youtube.com/watch?v=UpSKCRKb--E

20:55 <stellar-slack> <eva> things like lack of mobility, no legal right to open an account, no legal ID, no formal financial history, etc.

20:56 <stellar-slack> <eva> so if there were an accessible to all, open network for finance, there would be a way to actually get a read on people’s “creditworthiness.”

20:57 <stellar-slack> <eva> It also just takes the software costs (internal costs for the MFI) way down, which reduces waste and lets them serve people more effectively.

20:57 <stellar-slack> <eva> Most of the tech they use is highly outdated

21:00 <stellar-slack> <eva> So if you swap out, say, a 9 hour busride cash transfer for a 3-5 second digital transfer, you’re saving time + money that could be used to better serve people

21:00 <stellar-slack> <eva> (that’s just one example, of course)

22:23 <stellar-slack> <eva> FYI: The Stellar network upgrade will be here November 3rd. Watch for more info :)