The Central Bank of Nigeria (CBN) has pledged more measures to jumpstart the low adoption of its digital currency, the eNaira.
The move comes after Zimbabwe recently ordered that all government services to be paid in the local ZiG currency, part of new measures to boost demand for the nation’s gold-backed currency, with over 500 traders and individuals fined for refusing to accept the ZiG.
🇿🇼REGULATION | #Zimbabwe Government Services and Some Taxes to be Paid in Local ZiG Currency Instead of Dollars, Orders Finance Minister
A crackdown, led by the central bank’s financial intelligence unit and police, to defend the ZiG from speculation on the parallel market, has… pic.twitter.com/uhHERL81ku
— BitKE (@BitcoinKE) July 29, 2024
According to the Monetary, Credit, Foreign Trade, and Exchange Policy Guidelines for the Fiscal Years 2024-2025 published by CBN on September 17 2024, the apex bank intends to enable payments into government accounts and allow Ministries, Departments, and Agencies (MDAs) to process vendor and beneficiary payments using the eNaira.
“The CBN shall continue to work towards enabling the use of eNaira Wallet/Channels by payers to pay into government accounts at the CBN, and allow Ministries, Departments, and Agencies (MDAs) to initiate vendor/beneficiary payments from their respective eNaira Wallets,” reads the document.
The digital currency has struggled to find traction since its launch in October 2021 despite different activities to promote and inculcate its usage.
Less than 0.5% of Nigerians🇳🇬 are Using the eNaira One Year Later
Reports from the ceremony also indicate that 700,000 transactions worth $18.3 million had been made on the eNaira’s platform in the first year.https://t.co/g6zmUZU1Yt
— BitKE (@BitcoinKE) October 27, 2022
According to the quarterly statistical bulletin for the first quarter of 2024, eNaira accounted for N13.98 billion out of the N3.87 trillion in currency circulation by March 2024, approximately 0.36% of the total currency in circulation within the country in Q1 2024.
Additional measures to boost adoption and use for the eNaira includes partnering with federal and state governments to boost adoption and the launch of eNaira version 2.0, which aims to increase the involvement of deposit money banks in its use.
[WATCH] The Central Bank of Nigeria 🇳🇬 Expands eNaira Use with ARGO Wallet Targeting 5 Million Farmers By 2024
There has been a notable increase in the activity of the Nigeria Central Bank Digital Currency (CBDC) in recent times. In March 2023, there was a 63% year-on-year surge…
— BitKE (@BitcoinKE) May 11, 2023
Planned features also include offline functionality and programmable money, which will integrate the eNaira into both online and offline government operations.
“The CBN issues and regulates the eNaira, a digital form of the fiat currency. The eNaira offers several benefits which includes faster and cheaper payments, increased financial inclusion, and reduced fraud, amongst others.
“The CBN shall sustain efforts in enhancing the eNaira and driving its adoption. This includes the deployment of eNaira version 2.0 with focus on wholesale Central Bank Digital Currency (CBDC) to increase the participation of deposit money banks and empower them to drive its adoption; implementation of offline functionality, programmable money; and more collaboration with Federal and State Governments to increase its adoption.”
Last year [2023], the International Monetary Fund (IMF), deemed the progress of the eNaira adoption as relatively low, recommending the bank to consider utilizing government aid programs, merchant payment systems, and more favorable foreign exchange (FX) rates for remittances to incentivize broader adoption of the eNaira.
IMF Advises Nigeria 🇳🇬 to Consider Mobile Money Integration to Boost Slow eNaira Adoption
The @IMFNews has expressed disappointment over the relatively low adoption of Nigeria’s CBDC, the #eNaira, more than a year since launch.https://t.co/pfEh3yKmMh pic.twitter.com/UIhRYNqQHt
— BitKE (@BitcoinKE) June 29, 2023
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