Comparing to traditional lending: Where exactly is Huma's 'Time Value of Money' model advanced?

The logic of traditional lending is very simple: if you have collateral, I will lend you money, making a profit from the 'risk spread'. However, Huma's core is the 'Time Value of Money (TVM)' model. What is its advantage? First, we need to understand TVM. Simply put, '100 yuan today is worth more than 100 yuan tomorrow' because today's money can be used immediately to generate more value.

Traditional lending does not fully utilize TVM. For example, if you have a future salary of 1 million yuan but need money urgently today, traditional methods either won't lend you any money or will only lend you a small amount, leaving your 'today's demand' unmet and wasting 'today's capital value'. Huma's TVM model transforms 'future money' into 'today's cash flow' more efficiently.

For instance, if your monthly salary is 10,000 yuan and you can earn 120,000 yuan in the next 12 months, traditional lending might not lend you a penny because you have no collateral. However, Huma's TVM model will calculate 'the present value of this future income of 120,000 yuan' and approve a loan of 70%-90%, allowing you to access money for emergencies today and pay it back when you receive your salary in the future. Moreover, the entire process is automatically calculated through smart contracts, eliminating the need for manual assessment, making it more accurate and faster than traditional methods. This is not only a change in 'lending methods' but also a re-utilization of 'capital value', showcasing a significant advancement. #HumaFinance🥰🥰@Huma Finance 🟣 $HUMA