New Economy Forum

Closing the Cash Gap With Cryptocurrency

In emerging markets, the shallow reach of traditional money systems means there’s less resistance to new financial technology.

Francis Wanjala teaches at a school in Nairobi’s Gatina neighborhood, where many families struggle to find the cash for school fees.

Francis Wanjala teaches at a school in Nairobi’s Gatina neighborhood, where many families struggle to find the cash for school fees.

Photographer: Natalia Jidovanu for Bloomberg Businessweek

At the Sifa Children’s Center, shacks made of corrugated metal serve as classrooms for some 300 pupils, circling an expanse of dusty, hard-packed earth that’s both playground and meeting space. Beyond the school stretches Gatina, one of the poorest neighborhoods in Kenya’s capital of Nairobi. Headmaster Francis Wanjala is standing in an unused classroom studying his phone; he’s just learned how to trade a blockchain-based digital token.

Four years ago, Wanjala joined a local experiment in economic development, agreeing to accept and use a so-called community currency, paper vouchers that complement the official Kenyan shilling as a means of exchange within Gatina. At the start, the headmaster, and every teacher, got an allotment of “Gatina-pesa” worth about 400 shillings ($3.93)—enough to pay for a simple family meal. They could then spend them at local businesses that had also signed on to use the vouchers. The school uses Gatina-pesa to buy vegetables, sugar, and other ingredients for lunches.