The Central Bank of Nigeria (CBN) on Thursday unveiled *997# as the Unstructured Supplementary Service Data (USSD) code for e-Naira, the Central Bank Digital Currency (CBDC).
The apex bank unveiled the code in Kano State as part of efforts to ensure a cashless society.
Mr. Folashadun Adebisi Shonubi, the Deputy Governor, Operations Directorate of the CBN, who launched the USSD code in Kano, said this was another milestone in delivering digital financial services to Nigerians and enabling their participation in the global digital economy.
According to him, e-Naira offers Nigerians endless possibilities when it comes to financial services and embodied its slogan: “Same Naira, More Opportunities.”
He said “Today marks a significant milestone towards achieving the objective of the second phase of the project which is to drive financial inclusion by onboarding unbanked and underserved users leveraging the offline channels.
“Specifically, we are here to launch the eNaira USSD channel using *997# for onboarding and transactions.
“The choice of the USSD as the premium offline channel for the eNaira is founded in an understanding of the peculiarities of our economy,” Shonubi explained.
He, however, urged Nigerians to embrace e-Naira as it is safe and would help in reducing the number of the country’s unbanked population.
“Approximately, 45 per cent of adult Nigerians do not have a bank account while 35.9 per cent are excluded from formal financial services.
“However, around 81 per cent of the adult population in Nigeria (86 million out of 106 million) own mobile phones (EFInA, 2021), in addition, there are about 150 million Mobile Subscribers in Nigeria (NCC, June 2022).
“Therefore, the eNaira seeks to leverage the huge opportunity mobile telecommunications presents as a distribution channel for the offering of digital financial services to the underserved and unbanked population” he stated.
Speaking on the reason for launching in Kano first, Hajiya Rakiya Muhammad, the Director, Information Technology Department of the CBN, said the CBN chose Kano to unveil the eNaira code because of its economic significance in the country.
Muhammad said: “We believe if Kano accepts the eNaira, everyone will accept it all over the country.”
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Nigerians Turned to eNaira For Transactions as Naira Scarcity Persists
Recent reports reveal that Nigerians increasingly turned to the nation’s digital currency eNaira as transaction value jumped a whopping 63% to N22 billion ($48 million) amid the ongoing cash crunch bedeviling the country.
The number of eNaira wallets is reported to have jumped more than 12-fold to 13 million since October last year.
Speaking on the recent surge in the adoption of the eNaira, Nigeria’s Central Bank Governor Godwin Emefiele said the eNaira has emerged as the electronic payment choice for financial inclusion and executing social interventions.
He further noted that the Naira circulation in the country had dropped to around 1 trillion Naira from 3.2 trillion Naira in September 2022. Hence, to bridge this deficit, he disclosed that more than 10 billion Naira of the CBN’s digital currency has been minted so far, and about 3.4 billion Naira is in circulation.
The increased rate of the eNaira adoption in Nigeria doesn’t come as a surprise owing to the fact that Nigerians have been struggling with a crippling cash shortage since the CBN policy to redesign the higher denominations (N200, N500, N1,000) of the naira notes.
Currency in circulation slumped to about 1 trillion naira from N3.28 trillion in December 2022 to N1.38 trillion in January and an estimated N982.09 billion in February 2023 representing a 235 percent decline. The shortage of cash has left many individuals in the country of about 218 million struggling to pay for basic needs. Investors King understands that Nigeria which has a $220 billion informal economy, thrives on cash transaction.
Recall that the eNaira was launched by the Central Bank of Nigeria in October 2021, which saw Nigeria become the first country in Africa to launch its digital currency. The CBN disclosed that the eNaira was introduced to increase remittances, foster cross-border trade, improve financial inclusion and enable the government to make welfare payments more easily.
The launch of the CBN digital currency however came as a surprise to a lot of Nigerians, as the CBN has been suspicious of cryptocurrencies, such as Bitcoin, after it issued a directive that prohibited banks from taking part in financial transactions involving cryptocurrencies, which many Nigerians often use as a hedge against naira depreciation.
At the initial launch of the eNaira, it was faced with widespread rejection and less usage from Nigerians. A year after the launch of the eNaira, less than 0.5% of Nigerians were using it. In a bid to encourage the digital currency adoption at the grassroots level, the CBN offered Keke NAPEP (tricycle taxis) and their customers a 5% discount for using the CBDC as means of payment.
In November 2022 one year after the eNaira launch, the CBN celebrated 700,000 completed eNaira transactions valued at ₦8 billion ($17.4 million). If the shortage of cash persists in the country, it is not far-fetched to say that the eNaira transaction rate would record another significant increase.
Naira Scarcity: CBN Introduces USSD Code For eNaira to Ease Transactions
The Central Bank of Nigeria, CBN on Thursday, introduced a USSD code for its digital currency, eNaira amidst naira scarcity.
Investors King reports that the USSD code given as *997*50# for the eNaira will be active and used on Bullnet platform.
Launching the USSD system in Lagos, the Chief Executive Officer, Bullnet Bulletin and Enquiries Networking Services, Bayo Akintoye stated that the new initiative will solve the cash crunch issue.
According to Akintoye, the introduction of the USSD code for eNaira will ease the suffering of the citizens until the country fully actualises its laid down cashless policy and economy.
He noted that the system will be helpful to those without bank accounts as they would only require their phone numbers to register and enjoy the services.
The CEO enjoined Nigerians to embrace the USSD eNaira system while stressing its benefits and easy usage for transactions.
“The CBN has collaborated with Chamsmobile Limited (a CBN licensed Mobile Money Operator and Super-Agent) to address challenges faced primarily by the unbanked, the underserved and those on the other side of the digital divide by developing the service known as ‘eNairaeNhanced Services’ via the eNaira USSD channel (*997*50#) which is fully run and powered by the patented Bullnet Platform.
“It is expected that Nigerians will proudly associate with this innovation and register to have the eNaira wallet. These wallets can be funded directly with cash-purchased vouchers (like the GSM recharge cards) or from funded bank accounts using bank cards via the web portal or using electronic payment with any authorized agent.
“Users can also transfer eNaira from one wallet to another simply by inputting the recipient’s phone number. The service also makes it possible for users to cash out by sending the eNaira directly from their wallets to an ATM and withdrawing the cash equivalent without the need for a bank account or bank card. The user can also send eNaira to a designated bank account for savings or further transactions,” Akintoye explained.
Also speaking, the Project Coordinator, eNaira Project Giant Team, Otaru Abdulkadir, who represented the Coordinator of eNaira, CBN explained that the eNaira, if well utilised will enhance financial inclusion across all states, improve cross border transactions, international transactions and boost the economy.
Investors King recalls that the eNaira was launched in October, 2021 as part of CBN’s measure to implement its cashless policy and move from a cash-based economy.
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