igeria’s digital currency was unveiled on Monday, October 25, at the Presidential Villa in Abuja by President Muhammadu Buhari.
The launch of the digital currency was originally scheduled for October 1 but was postponed due to other events planned for Nigeria’s 61st Independence Day celebrations.
The Central Bank of Nigeria (CBN) noted in a statement announcing the debut of the e-Naira that the product, which was developed after years of research, will push the boundaries of the payment system to make financial transactions easier.
The Central Bank also stated that the debut of the digital currency is a significant step forward in the evolution of money, promising that the e-Naira, like the traditional Naira, will be accessible to all.
The e-Naira is a legal tender issued by the Central Bank of Nigeria as a Central Bank Digital Currency (CBDC). It is the digital equivalent of the actual Naira, and it works just like cash.
The money in your bank account is Naira kept as deposit liabilities by the banking institution, whereas e-Naira is a digital currency that is a direct liability of the Central Bank of Nigeria.
The e-Naira has some important characteristics that everyone should be aware of and they include,
A Central Bank’s digital currency that is people-oriented
The e-Naira, according to the CBN, is not simply another CBDC (Central Bank Digital Currency); it is a people-oriented digital currency that uses technology to connect consumers and businesses for easier trading and financial inclusion. In the process of developing the platform, the Apex Bank claimed to have pushed limits, crossed divides, and shared true human experiences. On the e-Naira official website, the CBN stated, “We are the first audience-centric digital currency brandishing a face.”
Designed for today’s world
The CBN goes on to say that the e-Naira has been built through careful thought and implementation process that began with understanding current realities in Nigeria’s evolving payment landscape, working with clear objectives and principles built from those realities, meticulously laying out the aspects of the architecture and infrastructure, and noting real-time risk management protocols.
Cashless policy, National Financial Inclusion Strategy, Bank Verification Number, Shared Agent Network Expansion Facility, Payment System License Categorization, and NIBSS Payment Infrastructure Establishment were all taken into consideration.
Numerous benefits for the populace
The e-Naira is projected to promote economic growth by making capital and financial services more accessible, resulting in more economic activity at low or no interest rates.
It is also expected to provide a safe and affordable option for diaspora remittances, as well as speed up such transactions.
The e-Naira makes it harder for individuals or organisations to commit fraud because of its traceability.
While the e- Naira’s inability to be forged makes it extremely durable and reliable, it also promotes financial inclusion by making financial services available to populations that lack access to traditional banking.
With the creation of the e-Naira, local and international trade is expected to rise, and the country’s digital currency is intended to improve revenue collection by lowering the cost of managing cash.
Digital experience that is outstanding
The e-Naira is designed to make diaspora payments cheaper and safer, ensuring that people get greater value for their money. People can avoid the lines by paying their taxes and bills from the comfort of their own homes in a more convenient and reliable manner.
The CBN also guarantees that financial government aid would reach the people immediately because the e-Naira eliminates the middlemen and allows individuals to claim funds directly.
Secure banking, as promised by the e-Naira, is an added benefit. Those concerned about the safety and security of their financial information should be rest assured knowing that everything is traceable , thanks to the transparency.
The CBN claims that the e-Naira will allow people to send money, save money, and time.
Individuals and businesses will benefit even more from this initiative
When looking over the features, it becomes clear that there are specialised solutions that are all-encompassing for both individuals and corporations. It provides money transaction solutions to local and international Non-Governmental Organizations and Religious Institutions, ensuring that, at the end of the day, their attention is on completing their initiatives rather than on the security and use of the funds supporting each project.
While anyone can donate at any time, the e-Naira is designed to make expense tracking and report generation for Non-Governmental Organisations (NGOs) practically automatic. This is because the traceability of each e-Naira means that balancing ledgers and determining the exact identity of each e-Naira’s receiver happens in near-real time and in parallel with the payments’ transfer itself.
Customers are anticipated to return to businesses that use e-Naira payment alternatives because they can pay for services with such simplicity. Customers of e-Naira come from all over the world since international payments are not only possible but also quick and inexpensive. “The more patronage, the more profit!”, according to the CBN.
Furthermore, because the CBN has access to their wallet information and can make direct deposits on behalf of the government, e-Naira makes it easier for business owners to receive government assistance allowances.
Government revenue is also expected to rise, according to the Apex Bank, because e-Naira makes more funds available for development projects such as better feeder roads, more affordable education, and better-equipped health facilities by reducing cash handling costs and implementing more transparent taxing systems.
Spending e-Naira is expected to result in a wealthier government and a wealthier population.
Payment System using a Common Interface
Money can be easily transferred from a bank account to an e-Naira wallet. They can also scan QR codes in stores to pay with their e-Naira wallet.
Individuals may easily monitor their e-Naira wallets, check balances, and view transaction history, and users can send money to one another using a linked bank account or card.
The CBN says that the cost of sending and receiving money will be extremely low. Customers may check their payments at any time and from anywhere because there is always a transaction history.
The CBN noted on the e-Naira official pages that transactions between financial institutions are not only possible but also faster and less expensive. Customers can also benefit from fast cross-border transactions and a smooth foreign exchange process.
Finally, the e-Naira functions as both a means of exchange and a store of value, providing “greater payment prospects in retail transactions than cash payments.” It also has a unique operational structure that is “exceptional and unlike any other type of Central Bank money,” according to the CBN’s website.
The goal is to see e-Naira enable households and companies to make fast, efficient, and reliable payments while also benefiting from a resilient, innovative, inclusive, and competitive payment system, according to the CBN.