4. Digital Currency Adoption, Nonbank Financial Intermediation, and Financial Inclusion in the Global South

This chapter explores the transformative potential of digital currencies in fostering financial inclusion, particularly in the Global South. It delves into the adoption of digital currencies, the role of nonbank financial intermediaries, and the challenges and opportunities they present. The chapter highlights the potential of digital currencies to reduce transaction costs, eliminate intermediaries, and provide financial services to the unbanked and underbanked populations. It also examines the role of nonbank financial intermediaries in facilitating financial inclusion and the challenges they face. The chapter provides a comprehensive analysis of the global landscape of digital currency adoption, including key drivers, challenges, and success stories. It also offers a detailed examination of Africa's digital currency landscape, highlighting historical context, evolution, and unique challenges and opportunities. The chapter concludes with recommendations for policymakers and financial institutions to foster widespread acceptance and mitigate potential risks associated with digital currencies.