The Central Bank of Nigeria (CBN) has taken the drive for e-Naira to the University of Lagos. The apex bank intends to sensitise and engage students as advocates of the digital currency.
According to the CBN, students are a critical factor in the adoption of e-Naira. The bank noted that the e-Naira is accepted as the naira notes while it can also be used to pay school fees.
Speaking at the event, Director Information Technology Department, CBN/Co-ordinator Technical Working Committee e-Naira Secretariat, Hajiya Rakiya Mohammed who was represented by Dr. Khalifa Nuhu noted that the Central Bank has engaged several groups and organisations as part of the strategy to make e-Naira popular among Nigerians.
The e-Naira adoption team also paid a courtesy visit to the Vice-Chancellor of the University, Professor Oluwatoyin T. Ogundipe, FAS, at his office.
The team noted that the University of Lagos was selected as the pioneer institution for the onboarding exercise because the school is progressive and innovation-driven.
Investors King had earlier reported that the e-Naira adoption team visited the tricycle driver in Abuja to inform them about the e-Naira platform.
While speaking at the awareness program in Abuja, the adoption team disclosed a 5 percent transaction discount for any tricycle driver who uses the e-Naira platform. The team added that any tricycle customer who uses the e-Naira platform to make payment will also enjoy the same discount.
In another development, the Central Bank has disclosed that it will engage 7,740 e-Naira agents across the country as part of its efforts to boost adoption.
The apex bank noted that it will install and engage a minimum of 10 e-Naira agents from each of the 774 local governments in Nigeria to make up for the targeted number.
It will be recalled that the e-Naira was officially launched by President Muhammad Buhari, on October 25, 2021. It has a slogan of “Same Naira, More Possibilities” which symbolises the same quality as the naira note but with enhanced functionality.
eNaira Volume Surges by 284.6% to N9.78bn in August – CBN Report
The volume of eNaira in circulation surged by 284.6% to N9.78 billion, according to the Central Bank of Nigeria (CBN) in its recently published ‘Economic Report’ for August 2023.
This surge, however, stands in stark contrast to the declining trend observed in the volume of traditional notes and coins, which dipped by 14% to N2.65 trillion in the same month.
Despite the substantial increase in the volume of eNaira, the CBN emphasized that its share in the overall currency in circulation (CIC) remains relatively insignificant.
The ratio of eNaira to CIC stands at 0.37%, with notes and coins dominating at 99.63%.
The CBN report indicated that the reduction in the currency in circulation, declining by 11.7% to N2.66 trillion, was primarily influenced by the growing adoption of alternative payment channels.
More individuals are opting for electronic transfer payments and other digital platforms, contributing to the moderation of growth in reserve money.
The extension of time for companies to submit their annual returns, from January 1, 2024, to April 1, 2024, was also outlined in the CBN statement.
This extension, prompted by glitches on the company’s registration portal and a nod to the Micro, Small, and Medium Scale Enterprises sector, temporarily withholds penalties for companies falling within the earlier deadline of January 1, 2023.
The CBN encouraged entities registered under the Companies and Allied Matters Act to utilize the extended window to fulfill their annual return obligations, recognizing the challenges faced by businesses in adhering to the initial timeline.
While the eNaira has seen a significant surge in volume, its adoption, according to a report by the International Monetary Fund (IMF), has been slow.
About 98.5% of eNaira wallets have reportedly remained unused a year after the digital currency’s launch.
The IMF report noted a gradual increase in retail wallet downloads, with eNaira adoption representing only a small fraction of Nigeria’s active bank accounts.
The CBN continues to navigate the dynamic landscape of digital currency adoption, with the eNaira experiencing both growth and challenges.
The central bank’s efforts to strike a balance between traditional and digital currency usage reflect ongoing shifts in the financial landscape and the evolving preferences of businesses and consumers.
IMF Managing Director Cautions About Unforeseeable Consequences of Retail CBDCs
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.
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