From Invisible to Investable: Using vLEI-Verified Digital Identity to Build Trust and Unlock Finance for MSMEs

The IFC–World Bank MSME Finance Gap Report (2025) estimates that MSMEs in 119 developing economies face a US$5.7 trillion financing gap -- the difference between what they need and what they can access. That gap equals 19 percent of global GDP, leaving nearly 40 percent of formal MSMEs credit-constrained, with women-owned and informal enterprises hit hardest.

Even as global credit supply grew by seven percent annually before 2020, the gap widened. The issue isn’t capital or technology; it’s about verifiable trust. Lenders still lack reliable ways to assess the performance of businesses operating beyond formal paperwork.

But, what is trust in the financial system if it can’t be verified without paperwork or collateral?

This challenge guided our participation in the 2025 Global Legal Entity Identifier Foundation (GLEIF) vLEI Hackathon, where Dataswyft won the Trade, Supply Chain Resilience & SME Finance category with its solution, “From Invisible to Investable: Financing MSMEs with the Dataswyft Wallet and vLEI.” The solution introduced an open, interoperable trust infrastructure that lets MSMEs own, store, and share verified data across wallets and systems.

Our goal was simple: Prove that when individuals and businesses own and control their data, they gain visibility and that visibility can be both trustworthy and portable. The result is financing based not on collateral, but on verified behavior.

Using verifiable Legal Entity Identifiers (vLEIs) - secure, cryptographic extensions of the traditional LEI -- Dataswyft showed how the Dataswyft Wallet powered by vLEI-signed credentials, can transform informal business activity into smart data, owned and controlled by each business. Anchored in Dataswyft’s Smart Data Scheme, the framework ensures end-to-end integrity, governance and scalability across borders, marking a milestone in the evolution of verifiable digital identity and trusted data exchange.

We showed that smart data, when owned and controlled by people, can transform invisibility into opportunity, unlocking access to finance for millions of MSMEs operating in informal economies. This lays the groundwork for a new class of verifiable, self-custodied digital assets.

Where Data Meets Reality: The Everyday Lives Behind the Innovation

Picture a smallholder farmer, Mary in an emerging market. She delivers every order, repays suppliers on time, and runs her business through sheer grit. Everyone in her community trusts her, but to the bank, she doesn’t exist. That’s because she has no credit history, verified records, collateral or loans.

This is the everyday reality for millions of micro, small, and medium-sized enterprises (MSMEs). They are productive, reliable and vital to their communities, yet invisible to formal finance. It’s not because they’re risky, but because they can’t prove they are trustworthy.

Traditional credit scoring relies on formal records -- audited accounts, bank statements, collateral -- that many informal businesses lack. As a result, their real performance and potential go unrecognized.

From Transactions to Trust: Turning Everyday Activity into Financial Proof

Together with our partner, Kuza One, our proof of concept is being implemented on the Kuza OneNetwork platform connecting over 6,000 agripreneurs and 1.5 million smallholder farmers across nine countries in Africa and Asia.

Within Kuza’s mobile app, the Dataswyft Wallet enables agripreneurs to collect and own their smart data -- verified credentials digitally signed by Kuza’s vLEI and legally owned by each user. These credentials are applied to digital badges.

Each time data is shared or a proof validated, Dataswyft digitally signs the transaction metadata, creating a verifiable record that layers on top of Kuza’s credential data. Together, they form a two-layer fabric of trust: Kuza anchors data trust, while Dataswyft ensures transaction trust. Through it all, the agripreneur’s data remains private, self-sovereign and under their full control.

Building Digital Trust Together

The prototype introduced three vLEI-signed identity badges—for agripreneurs, service providers, and finance providers—key roles within the Stockist Pathway Graph Badge (SPG Badge), which maps sourcing, financing, and logistics behaviors while generating an experience score for each user.

When Mary buys seeds from Adam, a service provider, that verified transaction becomes smart data owned by both in their Dataswyft Wallets. When Ruth extends credit for warehouse space, that record is likewise shared as verifiable behavior, providing proof that Maya controls and can use to demonstrate reliability.

Each verified transaction updates the SPG Badge, strengthening behavioral reputation across the ecosystem. Over time, it evolves into a transparent, portable record of trust that grows with every delivery, loan and repayment, turning once-invisible activities into verifiable digital trust.

As these records accumulate, they lower barriers for new entrants. New agripreneurs gain faster access to credit, service providers prove reliability sooner, and finance partners lend against trust data rather than collateral. The SPG Badge serves as a gateway to trust, helping participants find credible partners and transact with confidence.

Scaling Trust: From Wallets to Economies

As more participants join, each new credential and transaction expands the web of verified identities, amplifying the reach and value of vLEIs across the ecosystem. This growing web of trust is powered by individuals who own their data, control their visibility and collectively, they sustain a shared layer of verified trust.

The result is a self-sustaining, self-scaling trust infrastructure -- one where every verified interaction reinforces confidence, strengthens accountability, and expands opportunity without compromising accountability and data sovereignty.

This compounding effect accelerates the adoption of vLEI-based trust frameworks and lays the groundwork for verifiable and resilient digital economies where a new infrastructure for the digital economy takes shape.

Watch how the Dataswyft Wallet operationalizes digital trust — converting routine business interactions into verifiable smart data. Each click, credential, and transaction in this demo represents a new way to make finance inclusive, data-driven, and self-sovereign.

Data as a New Asset Class

More than this, within this framework, the Stockist Path Badge emerges as a visible, portable Self-Custody Data Asset (SeCuDa)—a new yield-generating investable asset class when data becomes ownable and tradable. Through vLEIs, this asset class can hyper-scale and power transparent, self-governing data ecosystems.