The Central Bank Of Nigeria to launch eNaira — The digital form of Naira

 eNaira is a central bank digital currency (CBDC) issued by the Central Bank of Nigeria as a legal tender. It is the digital form of the Naira and will be used just like cash.

It is developed by a Barbados-based fintech company, Bitt Inc., with CBN owning a majority stake in the company once registered in Nigeria.

The eNaira site, on its welcome note said the eNaira is a Central Bank of Nigeria-issued digital currency that provides a unique form of money denominated in Naira.

“eNaira serves as both a medium of exchange and a store of value, offering better payment prospects in retail transactions when compared to cash payments. eNaira has an exclusive operational structure that is both remarkable and nothing like other forms of central bank money,”the note says.

“There are several benefits from a central bank-issued digital currency in Nigeria, and this cuts across different sectors of, and concerns of the economy.”

The apex bank had earlier stated that is a legal tender just like the naira that must be accepted by all merchants and business outlets as a form of payment in the country.

The CBN governor, Godwin Emefiele, while speaking to a gathering of foreign investors in New York, recently, had told his audience that because of activities surrounding the country’s Independence celebration on October 1, the planned launch of the eNaira would likely be rescheduled to October 4, 2021.

“The central bank would not want the event to take the shine away from the Independence celebration,” he said.

“We are going to be the first country in Africa to launch a digital currency. It is a novel idea because we think it will facilitate trade, Nigeria being the biggest economy in Africa, this will set the tone to tell Africa that we are ready to lead and we would indeed lead in trade and we would make sure that happens.

“Between all central bankers in ECOWAS, we are already working on a certain collaboration to make trade, payment and banking system integrate in such a way to set the example on the African Continental Free Trade Area (AfCFTA),” he added.

The CBN took a major step towards the launch of its digital currency with its formal announcement of its engagement of global fintech company, Bitt Inc. as its technical partner for the project. 

Emefiele expressed optimism that the eNaira would bring about increased cross-border trade, accelerate financial inclusion and lead to cheaper and faster remittance inflow. He said the digital money would lead to easier targeted social interventions, as well as improvement in monetary policy effectiveness, payment systems efficiency, and tax collection.

According to him, after its unveiling, Nigerians should be able to download the eNaira app from either Google plays store or Apple app store, onboard themselves and fund their eNaira wallet using their bank account or with cash at a registered agent location.

“If you are a bank customer and you have, say N10 million in your bank account, for your comfort of spending and making a purchase, you can tell the bank to load N2 million out of your N10 million into your wallet.

“So, your bank balance in physical cash drops to N8 million, while your e-wallet carries N2 million. With that, you can make purchases both within and across the country.

“There is so many variance of the eNaira. But this is where we would start because we are not going to pretend that there are not risks in opening your system up. We would look at the various products, determine the risk, determine the best way to mitigate the risk before we now open it up more and more,” Emefiele added.

Also shedding more light on Bitts, he said, “We chose them as a partner. In some other climes where they are, they have their software and they earn their money. But we chose that they would establish their company in Nigeria.

The CBN will own substantially stake in that company. It is a company that will be established in Nigeria and majority holding will be the CBN."

On his part, the CBN’s Director, Corporate Communications Department, Osita Nwanisobi, explained that the eNaira project had been a long and thorough process for the apex bank following its resolve in 2017, to digitise the local currency after extensive research and exploration.