Amaka Obiefuna

In a couple of days from now, the Central Bank of Nigeria will be unveiling it’s Central Bank Digital Currency (CBDC), the eNaira, making Nigeria one of the first countries in Africa, and indeed the globe, to adopt the digitization of its national currency.

The Central Bank Governor, Mr. Godwin Emefele, made the disclosure in his 30-point keynote address delivered at the 31st Seminar for Finance Correspondents and Business Editors, held at the Maxbe Continental Hotel, Enugu.

He said the Central Bank of Nigeria decided to introduce a central bank digital currency, the eNaira, which would help in attaining our goals of fostering greater inclusion using digital channels, supporting cross border payments for businesses and firms as well as providing a reliable channel for remittances inflows into the country.

The CBN Boss said with the deployment of the eNaira, Nigerians in remote areas can conduct financial activities using their digital as well as features on phone devices.

The Apex Bank Boss expressed optimism that “partnering with our stakeholders in the financial industry, I believe that more Nigerians will be financially included”

While emphasizing the importance of a robust payment system in any economy, he said “As you are aware, the payments system of any country plays a pivotal role in its economy, being the channel through which financial resources flow from one segment of the economy to the other. This represents the major foundation of the modern market economy.

“In line with our mandate, as encapsulated in the Central Bank of Nigeria Act, 2007, the CBN regulates the Payments System, while banks, the Nigeria Inter-Bank Settlement System (NIBSS), the Nigerian Exchange Group, payment service providers and switching companies are the other major players in the system. The CBN, complemented by the Nigeria Deposit Insurance Corporation (NDIC) provides the necessary oversight function to ensure the efficiency and effectiveness of the payments system.”

While tracing the history of payment system in Nigeria, Emefele stated, “The year 2007 marked a turning point in the country’s payments system terrain with the launch of the CBN’s Payment Systems Vision 2020 (PSV 2020), which identified series of recommendations to increase the resilience of the payment system infrastructure and work- streams to encourage the usage of electronic payment methods. Since then, the country has continued to introduce initiatives that would help simplify payments and deepen financial inclusion.”

He said over the past 14 years, the Nigerian payment system has evolved significantly with extensive technological development backed by deliberate enabling regulation by the CBN which he said has accelerated the development of novel financial products, services and channels all of which have placed Nigeria at the fore of the financial innovation race.

He said due to the lockdowns associated with the management of the Corona Virus (COVID-19) pandemic, financial traffic to digital platforms increased significantly in 2020 and accelerated the speed of digitalization of many sectors of the economy.

This, he said,  have increased discussions around the issue of the digital economy just as more opportunities have come up for financial institutions and other players within the payment ecosystem to innovate and provide more efficient options for payments and settlements.