Ripio Credit Network Peer-to-peer credit network

RCN is a global peer-to-peer credit protocol based on co-signed smart contracts that connects lenders and borrowers all over the world, aiming to enhance transparency and reliability in the lending ecosystem.

Background

Ripio Credit Network (RCN) is a project being developed by Ripio, a blockchain startup in Latin America which originally operated a bitcoin payment platform under the name BitPagos. In Jan. 2017 the company rebranded and took on Ripo, the name of its original wallet service, as the company name. In 2016 BitPagos introduced Ripio Credit which currently allows users to create installment loans using bitcoin. Unlike traditional loans, Ripio Credit does not require users to possess a credit card or bank account.

RCN was created to decentralize the lending process by leveraging a series of smart contracts and the existing Ripio credit application. In the RCN network borrowers and lenders are matched through a custom smart contract. Third-party services are used to verify a borrowers identity and a credit score can be generated by a scoring agent. To ensure that lenders are protected in the case of a default co-signers are used to act as guarantors. Co-signers are responsible for collecting defaulted payments in accordance with local regulations.

While loans can be denominated in local currencies the third-parties in the network like identity providers and scoring agents are required to use the RCN token for exchanging payments. A price oracle is built into the network to provide real-time price details for these agents. This means that in order to participate in the network it is necessary to own RCN tokens. Ripio Credit launched as the initial provider of all services, including wallet provider, scoring agent, id-verifier, co-signer, and credit provider for users in Argentina.

Technology

The RCN network provides the basic infrastructure for providing loans to users and matching them with lenders. Wallet providers, who wish to offer loans to their users, are able to create custom smart contracts that allow them to specify the terms of a loan, receive funds from lenders, and distribute them to borrowers. When a user provides their information to a wallet application a smart contract is created containing details such as the loan amount, rate, and repayment details before being broadcast to the network. The borrower's information is then verified by an identity provider and a credit score is created by a scoring agent. Co-signers are responsible for establishing the terms under which repayment will be collected and if they sign off on a loan are responsible for collecting defaulted payments. After a loan has been verified and signed by a co-signer it is listed on a credit exchange for lenders to review. Lenders then have the ability to select loans that they wish to fund. Because multiple types of currencies will be used within the network Ripio has created an oracle service to provide price information to the smart contracts.

The Basalt is the last stable version of the RCN protocol it's currently working on the Ethereum mainnet; allows borrowers, lenders, and cosigners to request, lend and pay bullet loans. These loans are configured with an interest rate, a punitive interest rate, a duration, and a first payment date; all the accrued interests are calculated on-chain.