Estimated reading time: 11 minute(s)
A YEAR after its launch by the Central Bank of Nigeria (CBN), digital currency — the eNaira — has not gained traction. Less than one per cent of the population is said to be using the local digital currency.
According to a Bloomberg Report at the weekend, the acceptance of Africa’s first Central Bank Digital Currency (CBDC) has been very low despite the huge promotion and incentives.
According to the report, contrary to the estimation by the CBN on the level of local acceptance of the digital currency, “the eNaira has been a massive failure.”
The Bloomberg said that only one in 200 Nigerians use the eNaira, even after the government implemented discounts and introduced other incentives make it attractive.
The report expressed surprise at the low level of eNaira adoption given that “Nigeria has one of the highest Bitcoin adoption rates in the world—ranking 11th among all countries”.
Nick Giambruno of Financial Underground said the the Federal Government “figured Nigerians wouldn’t be able to differentiate between Bitcoin and the eNaira – they are both digital currencies, after all”.
Bloomberg however reported that “Nigerians’ passion for cryptocurrencies doesn’t extend to the apex bank offering.”
It also said that Nigerians view the eNaira as “a symbol of distrust in the ruling elite” and that the people view the government as “hostile to them and therefore have no interest in anything it introduces.”
Two groups have explained the lackluster acceptance of the eNaira in the country, Bloomberg said.
It noted that some people refused to accept it because they do not trust the issuer and there are those who reject it because the eNaira does not offer immediate value like other digital currencies such as the bitcoin.
Public views on the eNaira were sampled from comments on Nick Giambruno’s tread on twitter when he reviewed the Bloomberg report.
At the 28th edition of the Annual In-house Executive Seminar on “Digitalisation of Money and Monetary Policy in Nigeria”, Deputy Governor, Economic Policy of the CBN, Dr. Kingsley Obiora had rated the eNaira a success.
According to him, with the successful launching of the eNaira on October 25, 2021, the experience so far with the eNaira has been a remarkable success story.
He said since its launch, the eNaira offers Nigerians endless possibilities in using financial services, thus, living up to its slogan, “Same Naira, More Possibilities.
“The volume of the eNaira-in-circulation is currently at N2.10 billion, a growth of 190.1 per cent; 927,000 total downloads; 317,560 activated consumer wallets; 33 banks are fully integrated and live on the platform,” Obiora said.
He hinted that N3 billion has been successfully minted by the CBN; N2.10 billion has been issued to financial institutions; over 3,320 merchants have successfully registered on the eNaira platform across the country, including Shoprite, Sahad Stores, A.A. Rano, among others.
Obiora noted: “Over 700,000 transactions amounting to about N8 billion have been recorded on the platform; and there are over 2.5 million daily visits to the eNaira website.
The CBN, working with relevant stakeholders will continue to unlock new phases and possibilities in facilitating a reduction in cash processing costs and an efficient payment ecosystem in Nigeria.”
The CBN top official admitted that “the banking and financial systems are still grappling with some challenges, such as the depth of financial inclusion, which according to Enhancing Financial Innovation & Access (EFInA), 17 million adults are not currently making electronic payments but own phones and are interested in mobile money.
Obiora said: “Another 22 million adults are not currently making electronic payments but say that they could be convinced to use it. This reflects the extent to which the eNaira could impact on the unbanked and underbanked to improve livelihoods, as well as economic growth and development in Nigeria.”
He appealed to Nigerians to “continue to improve on the rate of adoption of the eNaira, especially for the informal sector of the economy”.
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