The Central Bank of Nigeria (CBN) remains committed to its central bank digital currency (CBDC) project despite the ousting of the former governor. The CBN recently upgraded the CBDC mobile app by incorporating Near Field Communication (NFC) technology, allowing for convenient and contactless eNaira payments. This upgrade is expected to boost adoption rates for the CBDC.
Previously, the CBDC app featured QR codes, but the addition of NFC technology is seen as a game-changer by the CBN. Joseph Angaye, the deputy director of the CBN’s risk management department, stated that the banking regulator is committed to using innovative technology to enhance user experience. The introduction of programmability features in the CBDC is seen as a way to limit payments to designated government programs, reducing the risk of fraud.
Angaye further explained that the programmability of the CBDC could be used to allocate funds specifically for certain purposes, such as tool acquisition for farmers. By doing so, the funds in the eNaira wallet can only be used for their intended purpose, preventing any diversion or misuse. This feature aims to address issues of financial inclusion and provide valuable insights for other economic players looking to adopt CBDCs.
The eNaira was launched in Nigeria in 2021, making the country part of a select group offering a CBDC. However, adoption rates have fallen below expectations, prompting the central bank to explore various options to drive usage. Use cases were rolled out in the transport sectors and USSD functionality was added to the offering. Former CBN Governor Godwin Emefiele blamed commercial banks for stifling the growth of eNaira in favor of their own profitability.
Despite the challenges, the CBN’s commitment to the CBDC project remains strong. The integration of NFC technology in the mobile app and the introduction of programmability features demonstrate the bank’s determination to enhance user experience and address financial inclusion in Nigeria. This commitment sets a valuable example for other countries and entities considering the adoption of CBDCs.
In conclusion, the CBN continues to push forward with its CBDC project, enhancing the eNaira mobile app with NFC technology and programmability features. The aim is to boost adoption rates, address financial inclusion, and learn from the country’s experience as a pioneer in CBDC adoption. Despite initial challenges, the CBN remains committed to driving the usage of eNaira and providing valuable insights for the global adoption of CBDCs.