|White Paper URL||https://populous.world/invoice-finance/populous_whitepaper_final_v1.pdf|
Populous is a peer-to-peer invoice discount trading platform built on the blockchain. It does this through the use of smart contracts to automate transactions between invoice buyers and sellers on the platform. In addition, it minimizes risk via XBRL data and Altman Z-scores. Populous’ mission is to completely disrupt the invoice industry while at the same time creating a more liquid marketplace for both buyers and sellers.
Table of Contents
The Idea and the Team Behind Populous
Populous was built on the principle that small and medium-sized enterprises (SMEs) need access to funds to provide funds to employees or purchase goods and services. Traditionally, these businesses would take out loans from banks and lending institutions – hence the current invoice finance businesses. Populous offers an alternative solution: a peer-to-peer invoice discounting platform. This is significant in an industry in which the UK alone reported that the peer-to-peer lending industry comprised more than £1 billion to the UK economy in Q2 of 2018. Lending banks have also suffered a decrease after Brexit, although lending remains a need for small and medium-sized businesses. Peer-to-peer lending offers an alternative to traditional lending in banks or other centralized institutions.
Invoice discounting gives businesses access to instant cash that would be otherwise locked up in outstanding sales invoices. Instead of having this cash frozen and inaccessible, invoice buyers buy invoices at a discounted rate, releasing the cash. When invoices are paid, the invoice buyer receive the rate which they agreed upon at the time of their initial purchase.
Populous was founded by Stephen Williams, who was previously the founder of Olympus Research, the UK’s leading source of commercial data and analytics for businesses. He has an extensive background in the financial industry and in particular in extracting data from businesses using XBRL.
Populous has a number of strategic partnerships. In May, it announced that it would join forces with Cashaa, a banking platform that enables anyone, regardless of whether or not they have a bank account, to make transactions of fiat and cryptocurrency. Together Cashaa and Populous will offer the Cashaa wallet to all Populous users, in addition to increasing the Populous user base while doing so.
More recently, the company has signed an agreement with TradeSpace, an Indian invoice finance platform. The two companies together will provide more invoices for Populous, and invoice buyers will have more choices in the types of invoices they can buy. The partnership also marks Populous’ goal at being the first in the Indian market for invoice discounting.
The Populous Technology
There are several different participants involved in Populous’ technology:
- Administrators – These parties approve and manage transactions between sellers and buyers.
- Invoice seller – These parties sell invoices on the platform. They must be pre-approved before joining the platform.
- Invoice buyer – These parties must be approved before using the platform, although they can also use the platform anonymously if they choose to use PPT or supported cryptocurrencies available.
The Populous platform includes smart contracts that are able to minimize risk via a number of different methods:
XBLR (eXtensible Business Reporting Language) is used worldwide and is a global standard for many financial institutions to produce statements and data.
Populous uses XBRL in their backend, employing an XBRL engine that enables the company to view trends across industries in real-time. Data is collected from over 2 million sets of financial statements collected annually in the United Kingdom.
In total, Populous collects around 1 petabyte of data bi-annually. Insights gathered from this large data set help reduce costs for short-term funding for invoices.
Example of the type of data extracted via XBRL
Smart contracts are essential in completing the transaction between an invoice seller and buyer. Once a buyer is successful in funding money for the invoice, for instance, those funds are delivered to the seller via an automated smart contract. The smart contract works automatically as confirmation of the funds are put in the system.
Altman Z-scores are another standard in the financial industry. They predict whether or not a business will go bankrupt in the next 2 years; whether it will default on financial obligations; and also functions as a control measure for financial woes. It is known to be an accurate predictor of bankruptcy 2 years before it occurs and is widely used by financial professionals.
Populous Price History
After raising over $10 million in its ICO, Populous launched its token in July 2017 at an initial price of $2.81. The token hit a peak of $68.91 at the end of January, perhaps in response to the company’s beta launch. The price then fell before rising briefly to $27.53 on April 21st and continuing on a downward trend.
Pokens and PPT
Pokens are ERC-20 tokens that power the platform. Users purchase invoices using Pokens. The token protects both parties of the transaction – both the invoice buyer and seller – from volatility in the marketplace. Pokens are pegged 1:1 with whichever national currencies are involved in the transaction. You can purchase Pokens directly on the platform as well as via the supported cryptocurrencies.
PPT, also known as the Populous Platform Token, are used for investing in invoices. Invoice buyers can receive Pokens by depositing PPT into the platform.
How to Purchase PPT
PPT is also available on the following exchanges:
- Binance (Trade PPT with BTC on Binance)
- Mercatox (Trade PPT with ETH on Mercatox)
- Bithumb (Trade PPT with KRW on Bithumb)
- Binance (Trade PPT with ETH on Binance)
- Mercatox (Trade PPT with BTC on Mercatox)
How to Store PPT
PPT can be stored in any wallet that supports ERC-20 tokens such as Coinomi, MetaMask and Myetherwallet.
For maximum security, however, you should store your PPT on hardware wallets such as Ledger Nano S and Trezor.
Roadmap and Future Plans
Populous does not have an official roadmap, but it does publish company updates on its blog and on its Twitter account. The company announced that it was testing their platform earlier this month and should announce a live version of their platform soon.
For many businesses, waiting 90 days for customers to pay them results in a shortage in their cash flow. Factoring is a cash-management tool to deal with this challenge businesses face, of which one solution is invoice discounting.
Populous offers an alternative for those using invoice discounting, particularly in the construction, recruitment manufacturing, logistics, and wholesale and distribution industries.
With its team of technology experts, Populous is poised to completely transform the trillion-dollar discounting industry.