Offtopic (offHiveFest) but had to get the idea out: HCC - HiveCommunityCredit: Microloans on Hive

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For years, (10 already!!) Hive has shown that you don’t need smart contracts to build powerful, community-driven applications. With built-in features like escrow_transfer, recurrent_transfer, and custom_json, Hive already offers the building blocks for transparent agreements and (partly) automated payments.

A recent conversation got me thinking: How to enable the Hive blockchain and especially it's community to fund eachother through microcredits / microloans directly on Hive Layer 1? But then with some structure, automation and guarantees.

Previously I had build a Delegation app where you could browse and explore projects seeking delegation and then instantly delegate towards them. This can be a "GoFundMe" of some sorts build on top of the HiveBlockchain.

Instead of external databases or complex contracts, everything could be handled on-chain. But can it? Borrowers could request funds, investors could pool together, an escrow account could manage the release of capital, and repayments could flow back automatically to supporters.

HCC - Hive Community Credit

HiveCommunityCredit.png

How would it work?

Instead of reinventing the wheel, we can use Hive’s existing operations:

  • custom_json → to record agreements and events (loan.create, loan.repay, loan.payout).
  • escrow_transfer → to park funds with an escrow agent (a Hive account).
  • recurrent_transfer → to automate repayments (monthly, weekly, etc.).

This means: no smart contracts, no external database.
Everything lives transparently on-chain.

🐝 A simple MVP*: one project

Minimum Viable Product

To prove the concept, the first version could handle just one loan/project:
1. Borrower creates the loan with a loan.create JSON.
2. Investors fund it via escrow_transfer.
3. Escrow agent releases tranches when conditions are met.
4. Borrower sets up a recurrent_transfer for repayments.
5. Escrow distributes repayments pro-rata and logs it with a loan.payout.

Everyone can audit the process directly on the Hive blockchain.

Why this matters

  • Community-driven → the escrow can be a trusted account or even a multisig.
  • Social: You see who is lending to who. You see who you borrow from. Accountability!
  • No smart contracts needed → anyone with a Hive account can participate.
  • Transparent → every step is on-chain and verifiable.

Inspiration from microcredit

The concept of microcredit isn’t new — it has been transformative in parts of Africa, South Asia, and beyond. Small community-backed loans have enabled farmers to buy seeds, women to start local businesses, and families to fund education. Often, these loans rely on trust, transparency, and community accountability.

Hive could provide that same accountability digitally:

  • Transparent records of funding and repayment.
  • Low transaction fees and borderless access.
  • Community curation to spotlight projects that matter.

It’s cool to imagine Hive as a platform that mixes financial empowerment with social reputation.

🚀 Next steps: (yes after HiveFest bro)

I’m drafting a small Replit prototype:

  • Buttons to create/fund/repay the loan.
  • A dashboard showing the on-chain events.
  • Initially limited to a single loan project for simplicity.

What do you think?

Looking for your input before stamping out the code.

  1. Would you invest in such a Hive microloan? Why yes, why no, what do you want?
  2. Would you use Hive to borrow for a project or idea?
  3. What guarantees or reputation systems would you want added?
  4. Is this what Hive needs?

Ok Ok i hear ya: back to @HiveFest, tick tock tick tock

capital hivecredit credit finance microcredit loan hbd apr
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23 comments
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That's a nice idea, and a nifty way of setting it up! I had seen these loan.create and so on methods, but never knew what they were intended for (and didn't investigate deeper yet ;-) ), but it sure looks like a good way of doing it indeed, and all on the native Hive chain.
Two initial questions popped up:

  1. What are the requirements for an account to be the escrow? I suppose it needs to be a trustworthy account? And perhaps with enough juice to back things up?
  2. What if the the one requesting (and receiving) the loan powers down everything is gone with the noorderzon?
    Now, to answer your questions:
  3. Yes, I would invest in it. You gave the example of the benefits of microloans, and I've seen the same results happen indeed. So I'm a big fan of the system, it gives people opportunities, especially people in area (or circumstances) with little opportunities in general, I see it as a big plus! Also, Hive is quite popular in those areas as well, as a we discussed before, one nice upvote with rather limited meaning to us, can often be a world of difference for them. In comes microloans. On Hive.
  4. I would if I see the need for it, at this moment, no usecase comes to my mind, but that can easily change of course. But, yes.
  5. Good question... depending on the amounts, I would want to have some kind of reassurement that I will see my precious hive back in the future. Be it 50% backed by the escrow for instance, or base-amount to be recovered, without gains (interests), that would be ok I suppose. Also some kind of rating indeed, to prevent runners.
  6. Needs is a big statement, but I certainly do see a great deal of people using it because it can bring drastic changes to their lives...

Now get back to the Hivefest thing you! ;-)

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  • loan.create and such would be custom json entries, specifically for this app's purposes, leveraging custom_json storage of the chain.
  1. Good one. One can think of having a multi-sig.
  2. Another good one, but which is why I think an incremental pay out can work. This is how it was on bitshares. One would get an increment every X time or after X milestone had been reached.
  3. Cool thanks for your input.
  4. I was just discussing some microloans and noticed this isnt a thing on Hive.
  5. Or: more risk -> more return? Hive Gamble Credit. But then its not Credit but More Hive.VC.

Ok HiveFest!

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  1. And the option to choose... Have a good and safe deal, with a normal return, or you can see it as a gamble, high risk high return.
    I see possibilities there!
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Great idea! I really like the simplicity and that it's using the established layer 1 mechanics. No need for smart contracts indeed.

  1. I might, if I have enough guarantee that the loan will be repaid. Or if there is an interesting project looking for a loan, even if there is higher risk it might fail and the loan not repaid.
  2. Yes, I might.
  3. I guess the most obvious thing is putting in collateral. And that could be in a variety of cryptocurrencies.
  4. It would give one more use case which many people could make use of. It also ties in very nicely with HBD and builds upon its unique features.
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I like this idea. Although your focus is on micro loans for development projects, I wonder if the concept could include loans for crypto investments on or off the Hive blockchain... I recently posted a speculative blog post about using bitcoin as collateral for Hive based loans for investment purposes here: https://hive.blog/hive-112281/@hirohurl/what-if-we-could-use-bitcoin-as-collateral-to-borrow-hive-tokens

I guess your proposal doesn't require collateral, simply a willingness on the part of backers to provide capital for the loan, but I wonder if it would be possible to develop a lending platform on the Hive blockchain for bitcoin (or other crypto) collateralized loans...

!BBH
!ALIVE

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oh yes, that is very nice. Here in my thoughts I was still thinking about a base collateral yes. Could be provided by LP's who might get a share of the rev of the platform.

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Interesting. I was wondering about the borrower being able to put up collateral maybe through a bitcoin-based stablecoin, and draw from a lending pool, rather like on Sovryn or Aave.
!BBH
!ALIVE

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I've been writing about loans forever, but not precisely the micro kind. That said, this is the sort of thing Hive needs, but I have some questions for you. Some question and then some info you might know or might not.

A new loan platform has just opened up. https://peakd.com/loans/@hive.loans/hlshare-has-been-distributed-hive-engine-token-is-live-now

Some details about it seem rather iffy, to be charitable, but alas. This idea is in people's mind, and thus you do well exploring it.

Now...

When I think about us coming up with loans, or the main reason why I think its needed, is to precisely attract big money to our chain. To destroy the barrier of the 3 month powerdown friction that usually makes people go "Wut?"

So, someone with let's say 100k hive power, can loan against his/hers HP if need be, pay of course the fee (commission for the lenders), or let's call it penalty for taking out big chunks of HP up front. Deposit Certificates here in South America have a similar dynamic. I put, let's say 50k locked in for a year, if I need it before, I pay a fine, but I can take it back if I absolutely need it.

The challenge to me becomes, how do guarantee repayment? How do we make it close to impossible for someone to run off with the money?

To me, there's only one way, and it's one that makes most people uncomfortable. All accounts that can participate of a loan system, have to have their recovery account set to the escrow account. And, funny enough, and this is the part most people will absolutely reject, have their Owner key held in escrow. This is the part when a smart contract is needed, the "you won't get away with it contract"

To be clear, the idea would be that while you are indebted, while you have to repay the loan, you know two things: 1) your recovery account is set to the escrow service 2) your master keys is held by a smart contract of sorts.

So, if the person tries to pull a: Bye Wilma, thanks for the fish...

If he or she tries to change keys, or change the recovery account before full repayment, then the smart contract recovers the account and locks the person out.

Meanwhile, if the person is making payments, not changing keys, just posting along, doing what they do: After the loan has been satisfied, the smart contract deletes the keys, and thus the account now is chainless.

For me this escrow system should also then, almost by necessity, offer a recovery service for accounts, like the one Arcange runs.

If we build something like this, in my humble opinion, we build a system where big money can come in and truly inject cash into this place. But, it would also have to go in hand with lower the APR on HBD. Otherwise, its not so attractive. Another reason why this is 3d chess.

If we had a 8% APR on HBD, for example, and on average people providing liquidity through this loan system make 15, 20 points on their money- we got- in my opinion, a winning combo.

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thanks for your feedback and your input. I had missed the hive.loans one tbh. So can we also think about a software upgrade / hardfork and generalise the functionality for this?

also: can one person not just funnel away the money instantly to another account?

also: how does a microcredit intermediate guarantee payback of the loans to the lender? Somethings to be researched.

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(Edited)

Hive has shown that you don’t need smart contracts to build powerful, community-driven applications. With built-in features like escrow_transfer, recurrent_transfer, and custom_json

Two of those three are smart contracts 😅

As to the idea, yes, depending on who is asking for a loan and what the interest rate is, I would invest in Hive microloans. I used to use BTCjam and bitlendingclub before they shut down :'-(

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(Edited)

Great idea, congratulations for the initiative! I only read the post briefly but reminds me the crowdfunding vibe of supporting projects and even rotating saving and credit associations like the moai (or tanomoshi) I knew as a descendent of Okinawan immigrants. Keep safe and good luck again!!

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I'm all for keeping things simple. A lot of the smart contract stuff I see seems very complex. If you can have this escrow account controlling only if funds get released or returned then it should work. I have thought that some sort of crowdfunding could be a good fit for Hive. In any such system there has to be trust, but that is something people have to earn. I don't think you can do it all with algorithms.

Have fun at HiveFest. I won't be there this time, but I will get to one when I can.

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This is the kind of project that I think would greatly benefit from what we're doing on Invennium. You could use the template app that's nearly built prime pick, rip out the stuff about prediction markets and replace it with stuff about loans and micro loans.

It would be a web3 mobile app for peer to peer lending and use hive keychain out of the box to sign transactions both through web and mobile browsers.

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Interesting post. Every day, more and more people are leaving the Hive platform and its rapid growth.

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thats a great idea, this is more interesting and needs to be improved here in crypto, I just read that you can get a loan in crypto. but what are the requirements for this?

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There is a need for loans here on HIVE and in fact there is a working system in the Spanish speaking community for over 3 years with over 500 loans.
Source: https://peakd.com/hive-167922/@ruta.loans/superamos-los-500-prestamos-otorgados-esp-eng

They do ask for your keys.

I don't think that klye's hive.loans that meno mentioned requires giving keys, but "Users seeking loans on the platform will have to set their recovery account to the @hive.loans account".

You can read all about this Hive Loan project, including some of how it would work and parameters of the offered loans in a post. That post also says "last 10% of development is planned over the next few months" so it is mostly created but of course the last 10% of a project sometimes takes more time than the prior 90%.
Source: https://hive.blog/loans/@hive.loans/hlshare-has-been-distributed-hive-engine-token-is-live-now

Would you invest in such a Hive microloan? Why yes, why no, what do you want?

Yes, I would consider it!

I bought some of hive-loans' HLSHARE tokens some years ago and the project got sidelined for a while but is now back, and all of us who bought HLSHARE have now received them on hive-engine.
Source: https://he.dtools.dev/richlist/HLSHARE
And they can be traded on hive-engine.
Source: https://hive-engine.com/trade/HLSHARE

I think I tried to be a loan provider with ruta.loans but they didn't need any more help, iirc.

SO yes, I would consider an investment in another loan project.

Whether I would take a loan depends on the parameters.

The best guarantee is one done with a smart contract so no keys are given and no trust is needed. I believe VSC will have smart contracts soon that will work for this type of situation. Maybe aggroed will have some code and/or contracts too, maybe using hive-engine contracts or maybe something new. See his comment on this post. A rep system is not needed if the system is run with smart contracts, maybe.

Hive probably needs this, but we won't really know until it is built.

I wish you all the best in your contemplation and possible work on a loan project like this!

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Interesting info. Thanks.
!BBH
!ALIVE

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This is such a thoughtful idea. Using Hive’s transparency for microloans could really empower communities in a unique way.

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