File: President Muhammadu Buhari with the Vice President Prof Yemi Osinbajo(SAN) and the CBN Governor Mr. Godwin Emefiele as President unveiled the eNaira at the State House Abuja.

By Bola Sobola

ACCORDING to Wikipedia, “e-money” stands for electronic money that exists in banking computer systems and available globally for transaction through electronic devices. Experts say an electronic money is a centralised digital monetary medium of exchange which has the capacity to promote socio-economic well-being of the people.

The Central Bank of Nigeria, CBN’s, version of digital currency called e-Naira, the first of its kind in Africa, was unveiled by President Muhammadu Buhari on October 25, 2021, in Abuja. The initiative signalled the readiness of the Central Bank of Nigeria to kick-start its digital currency just like China’s commitment to Yuan digitalisation.

The e-Naira is a Central Bank digital currency being regulated by the Central Bank of Nigeria, denominated in Naira with the theme: “same naira more possibilities” to serve as both a medium of exchange and store of value with a prospect of offering better payment in retail transactions when compared to cash.

Expert says successful implementation of e-Naira will bring great prospect with huge capacity to promote the nation’s economic development. A report from Reuters revealed that President Muhammadu Buhari opined that Central Bank innovation could grow Nigeria’s economy by $29 billion in the coming decades. This may invariably surpass the estimated crypto transactions worth $566 million within five years in Nigeria, all things being equal.

It is, therefore, worrisome that the digital version of Nigeria’s electronic naira, the first attempt in Africa had very low acceptability among Nigerians considering its poor starting. Some App reviewers explained that the mobile wallet of e-Naira which has same value and is interchangeable with the physical naira has multiple faults, difficult to operate and download.

For example, the two e-Naira wallets the Central Bank made available on the Google and Apple stores, one for individuals and the other for merchants, were barely working as expected. The persistent irregularities were corroborated by Mr. Fisayo Fosudo, a Nigerian YouTuber who reviewed gadget and apps; he said the Central Bank has merely jumped into the project without putting its house in perfect shape.

While trying to unravel the factors behind the poor acceptability of e-Naira, some experts submitted that Nigeria’s Central Bank should have taken time to understudy the feasibilities and challenges of operating CBDC in China. Citing CBDC plan in South Africa, which is another large economy for taking its time to launch out its digital economy. And instead of rolling out its citizens’ intra-country transactions, it only enters a trial of its CBDC project with other banks for international settlement by teaming up with other countries’ Central Banks like Australia, Singapore and Malaysia. 

Even the success recorded so far by the Central Bank Digital Currency, CBDC, that was applauded in some quarters as a growing success was hinged on the few number of its active subscribers who are merely willing to explore the new digital  technology. Others said e-Naira was poorly publicised, as about 85 percent of Nigerians were said to be ignorant of e-Naira digital wallet transaction.

Those that were highly informed about CBDC only saw it as a replacement for cryptocurrency which is a digital asset designed as a medium of exchange, where individuals coin ownership records are stored in a ledger existing in a form of computerised database with a decentralised control system that was banned in 2017. The prohibition caused great resentment and elicited varied protests among huge numbers of Nigerian youths who were said to have technically kicked against e-Naira acceptability.

Some experts said CBN should have carried out aggressive media publicity to assuage the negative perception of the youths after it was prohibited. They warned about the excesses, danger of decentralised control system created in 2009 by presumably a pseudonymous developer called Satoshi Nakamoto which exposes investors to high risk, and that bitcoin was not legal tender and unprotected in Nigeria by using both conventional and new media platforms to create massive public awareness before unveiling its digital currency. 

Moreso, the reminder of the prohibition on February 5, 2021 further escalated the battle against e-Naira acceptability by the youths as they perceive it as anti-livelihood of young Nigerians using cryptocurrency to escape poverty and unemployment in the nation.

Although the apex bank later explained through its Deputy Governor, Adamu Lamtek, that the bank did not ban cryptocurrency in the country to destroy the livelihood of the youths but that it only prohibited the transaction of cryptocurrencies in Nigeria banking sector to curb its excesses and protect unsuspecting investors from fraudulent activities.

The main concern after the launch of the programme in October 2021, was that the Apps only recorded over 900,000 downloads within 95 days compared to the estimated population of 250 million people living in the country. The CBN Governor, Godwin Emefiele, expressed optimism over acceptability of the e-Naira over time, considering the four years of thorough and painstaking consultations with relevant stakeholders and successful efforts put in place to integrate 33 banks into the e-Naira platform with 500m successfully minted by the Apex bank for the take-off of the programme.

The regulator said while 200m was issued to financial institutions, over 2,000 customers had also been on-boarded as at the  time of the launch.  Meantime, 87 countries were reported to be currently exploring the CBDC as  Nigeria has joined the league of countries that have so far launched their CBDC projects globally, including China and South Korea.

The national set target on e-Naira has not been met, as reports indicated that several merchants and retail stores in the country are yet to accept digital currency as a medium of exchange. Some analysts noted that most rural areas and regions of Nigeria are still faced with network challenges where the network penetration is still heavily dependent on 2G and 3G networks, which spells difficulty for e-Naira transactions on the internet.

Financial analysts categorically stated that “success of the e-Naira” is largely dependent on the number of active users, rate of merchants adoption and the value-added services available on the “app”.

Nevertheless, the e-Naira has so many opportunities that are beneficial to the people. The analysts noted that”the e-Naira has potential to unlock new opportunities for the industry”.

The e-Naira would increase remittances, foster cross-border trade,improve financial inclusion, enable the government to make welfare payments easily among others. It is therefore   not debatable that wide acceptability of CBDC will in no small measure improve economic activities and also boost the nation’s GDP.

Some of the e-Naira functionality delivers speedy, safe and simple trading transactional opportunities to customers and end-users. It is also easily transferrable through peer-to-peer formats, and   practically programmable for any use, as it was pegged at a flat currency.

  This lofty initiative of Nigeria digital currency should not be allowed to go down in flames. Federal Government should wade into the situation and embark on aggressive awareness campaign to enlighten the citizens   through the use of jingles and placement of adverts on the billboard emphasising on huge economic values inherent in e-Naira transaction across the nation. Adverts must also run on the media stations that will enlighten people more on economic values of CBDC.

In preparation for the nation’s digital currency, the Ogun state Governor, Prince Dapo Abiodun established TechHub where different categories of people were being trained on Information Communication and Technology (ICT), exposing its citizens to digital technology, particularly on website designing among other   professional certifications.

Records showed that about 49 percent population have received training in website designing, internet operation among other areas in computer core applications with beneficiaries ranging from civil and public servants, students from various schools, professional bodies, individuals as well as corporate organisations across the state.

Ogun state government has made the people more computer savvy by exposing them to higher digital technology.  Other State governments can take a cue from Ogun State in preparing their citizens for the growing digital world that has come to stay. 

As a matter of fact,  Central Bank of Nigeria should make the Apps easy to download for active users and improve on its website so as to make e-Naira digital wallet feasible and easy for the youths to use in building enduring livelihood   that will transform into socio-economic development of the nation.

Sobola, is an Information Officer in the Ministry Of Information & Strategy, Oke-Mosan, Abeokuta, Ogun State

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