The Central Bank of Nigeria (CBN) has said the Central Bank Digital Currency (CBDC), eNaira, will strengthen the Nigerian banking system and protect Nigerians from the unregulated crypto space.
Mr. Folashodun Shonubi, the Deputy Governor, Operations, CBN, disclosed this at the virtual Chartered Institute of Bankers of Nigeria (CIBN) advocacy dialogue series 4 held on Thursday in Lagos.
He said eNaira will make it easier for operators in the banking system to comply with existing laws such as customer protection against fraud and anti-money laundering.
Shonubi explained that “The Central Bank in its implementation has ensured the e-Naira feeds our economy and provides greater value.
“The central bank digital currency offers all the benefits of cash but in digital form. Every single digital currency is an electronic version of the cash, the legal tender. When you make a cash payment, settlement is done instantly; digital currencies entail the same promises and even more.
“CBDC offers a safer option from the privately issued cryptocurrency which have been based on the possibility to enable cheaper transactions but have now been used for investment.
“The intention is not to eliminate other forms of payment but to complement the current areas of payment options, thereby ensuring the stability of the payment system in the long run. I expect in the coming days we will see rapid inclusion rates.
“For banks in developing nations, it will enhance their liquidity, efficiency in national remittances and challenge the high cost of remittances as the world rebounds in the post-pandemic. I am of the view that the era of CBDC promotes greater opportunities, and the central bank must be aware of the risks and mitigate them.”
Also speaking at the event was Lamido Yuguda, the Director-General of the Securities and Exchange Commission (SEC). He said eNaira scheduled to be launched in October 2021 will help deepen the capital market, increase financial inclusion and further diversify deposit and payment methods.
Yuguda said, “This is an opportunity for the fintech market to connect our people to existing opportunities in the financial market, connecting our people with investment opportunities in other climes. Once we do that, we would grow our market, Nigeria has 200 million people. We are blessed with a hardworking youthful population.
“This capital market would in turn finance the necessary infrastructure investment that this country needs today.”