Nigeria has become the first country in Africa and one of the few globally to launch a retail central bank digital currency (CBDC). The eNaira was launched by President Muhammad Buhari, and after a few glitches, it’s starting to gain traction as more Nigerians appreciate its benefits.
As CoinGeek reported, President Buhari launched the CBDC in the capital Abuja under the theme “Same Naira, different possibilities.” He also launched two wallets, one for the merchants and the other for the retail users. He claimed that the digital naira would bring in $29 billion to the Nigerian economy over the next decade, from a broader tax base and more efficient businesses.
Two days later, and after about 100,000 downloads on the Google Play Store, the eNaira app was taken down. Reports claimed that this was due to the barrage of negative reviews on the platform. However, officials from the Central Bank of Nigeria (CBN) clarified that it was taken down to undergo some improvements and it would be back online soon.
The app was restored later and has been online since.
Nigeria is now the first country in Africa to launch its CBDC. While its neighbor Ghana has been in close contention for the past few years, the West African economic giant has ventured into the bold new world of a digital national currency first. In this category, it joins the Bahamas, which was the first to launch a retail CBDC, as others like China appear set to officially debut theirs soon.
CBN Governor Godwin Emefiele said there has been “overwhelming interest and encouraging response,” noting that 33 banks and 120 merchants have already registered successfully on the eNaira platform, with about 2,000 retail users also onboard. The governor further stated that he had issued N200 million ($486,000) to financial institutions to maintain parity with the traditional fiat currency.
Despite the interest, some are expressing their concerns and doubts, however. According to a local outlet, one of the contentious areas centers on the CBN’s liability over the eNaira. The central bank has made it clear that it will not be held liable “for any use, interruption, delay or inability to use the eNaira website, lost revenue or profits, delays, interruption or loss of services, business or goodwill, loss or corruption of data, loss resulting from system or system service failure, malfunction or shutdown.”
Some Nigerian business leaders have questioned this. One of them is Praise Gbemisola, the CEO of retailer Jade Stores.
“So, if my cash is stolen in the course of using the platform, I can’t hold the CBN liable? What then is the incentive for me to embrace the platform? This is strange,” Gbemisola remarked.
To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.
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