In April 2021, SokoWatch (now Wasoko), in collaboration with Mercy Corps Ventures and IDEO, launched a trial program to get retailers who use its app to make orders for their supplies and to store their funds on the app-based wallet.
Sokowatch has established itself as a last-mile delivery and inventory for retail customers across East Africa, recently raising $125 million in a series B round. Using an app, low-income retailers in communities across Kenya, Rwanda, Uganda, and Tanzania, can select their basic supply of goods to sell, and Sokowatch delivery agents bring them to their doorstep.
By depositing 50, 000 UST on Anchor protocol, a fast rising chain on Terra, SokoWatch was able to earn $2, 246 over the trial period.
The amount earned more than covered the rewards cost for retailer participation, which cost $989.
According to SokoWatch, the treasury held on Anchor required little management on their end and provided a lot more return given that savings accounts with traditional financial institutions in Rwanda generally offer less than 8% interest in a year.
While the solution seemed novel and demonstrated the potential to take advantage of the DeFi protcols to earn rewards, just 22% of retailers who signed up to the program actually took up the offer to leave funds in their SokoWatch wallet to earn rewards.
For those who made at least one prepayment and saw value and continued to use it, they, on average, added money 7 times over 10 weeks.
Nonetheless, since the cryptocurrency was held in a single SokoWatch treasury rather than individual crypto wallets for each merchant, they eliminated some of the biggest user challenges of owning a cryptocurrency account, which includes:
Setting up the wallet
Securing access (and being sure not to lose the key)
Getting cash in and out of the wallet
According to SokoWatch and their partners, besides the impact that DeFi Treasuries can have, they also determined that the retailers who were in the pilot group were less interested in the opportunities for earnings, instead, asking SokoWatch for more improved services.