Nigerian CBDC Not Used Widely Even After A Year

On October 25th, the e-Naira celebrated its one-year anniversary, which was released by the Central Bank of Nigeria, but the digital currency has mostly been snubbed by the residents.

The central bank wanted to boost the use of the central bank digital currency (CBDC), due to which it has decided to offer a discount of 5% for motorizing passengers and rickshaw drivers using the e-Naira.

A deputy governor at the Central Bank of Nigeria, Kingsley Obiora said that the digital currency requires the government to give it a little push for it to be embraced widely.

Phase 2 of E-Naira

Critics have been watching the progress of the e-Naira as it hit its first anniversary this week and they claim that the first African central bank digital currency (CBDC) has still not been embraced by the average Nigerian.

They have highlighted the relatively low number of downloads that have been seen for the e-Naira, along with the fact that the use of cryptocurrencies is growing in making cross-border payments and for remittance purposes.

According to reports published in August, the peer-to-peer trading volumes of bitcoin on Paxful from January to June of this year on Paxful were close to $400 million.

This figure is more than 50% of the figure that was recorded last year, which was around $760 million.

Paxful said that peer-to-peer trading platforms and cryptocurrencies were in use by Nigerians because they offer an opportunity of ensuring financial inclusion.

CNB

Even though Nigerians appeared to have snubbed the central bank digital currency (CBDC) that the Central Bank of Nigeria (CNB) has launched, the bank is not deterred.

It has been predicted that the number of downloads of the e-Naira wallet will see an eightfold increase. In order to achieve this, there are a number of initiatives that the central bank plans on using.

Some of these initiatives include providing the wallet app with the unstructured supplementary service data (USSD) feature.

Apart from that, the CNB has also reached out to payment service providers, which include Flutterwave, and the fintech giant is now offering merchants the option of using e-naira for payments.

Boosting the CBDC

In yet another move to give the CBDC a boost, the central bank has decided to give a 5% discount to passengers and drivers of motorized rickshaws that involve e-naira payment.

The technology partner of the CNB, Bitt stated that the onboarding of banked merchants and customers was in accordance with the second phase of the rollout of the e-Naira planned by the central bank.

According to the CBN, the third stage will involve adding a trade and exchange platform and also tokens that are specific for subsidies and grants.

Furthermore, they also plan on adding programmable payments with the central bank digital currency (CBDC).

Bitt’s CEO, Brian Popelka said that the year had resulted in a lot of firsts and the one-year milestone that the CBDC had achieved was undoubtedly an exceptional thing on the part of the Central Bank of Nigeria.