Discussion Paper

Digital Currency, Digital Payments, and the 'Last Mile' to the Unbanked


Abstract: Digital forms of payment are either not accessible or highly costly for unbanked consumers. This is because these forms of payment must be "funded" by some source of money, such as cash or a bank account. That creates the "last-mile" problem for the unbanked. This article examines various solutions for the funding problem that have been proposed in the literature, by regulators, and in bills submitted to Congress.

Keywords: payments inclusion; financial inclusion; unbanked; digital currency; digital payments; central bank digital currency;

JEL Classification: G28; G59; O33; O35; O38;

https://doi.org/10.29338/ph2021-09

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Provider: Federal Reserve Bank of Atlanta

Part of Series: Policy Hub

Publication Date: 2021-08-02