In the PayFi model, users are able to gain instant liquidity using future income, but many may worry about one question: how to control risk? The answer provided by @Huma Finance 🟣 is a smart contract-driven risk control mechanism.
In Huma's system, users' salaries, invoices, or cross-border remittances are digitized and analyzed by smart contracts. Based on the stability, periodicity, and historical credit situation of the income, the contract automatically calculates the amount that can be released, usually between 70–90% of future income. This not only ensures the funding needs of borrowers but also avoids defaults due to excessive overdrafts.
The advantage of smart contracts lies in their openness and transparency; all parameters and execution logic can be verified on the chain. This combination of "automation + transparency" makes Huma's PayFi network not only efficient but also more trustworthy than traditional finance. For users, this is a safe and reliable experience; for investors, it is a risk-controlled asset allocation.
