Mauritania has partnered with German tech company Giesecke+Devrient (G+D) to design its central bank digital currency (CBDC).
The Banque Centrale de Mauritanie signed an agreement with the Munich, Germany-based firm on the sidelines of the World Bank and International Monetary Fund’s (IMF) Spring Meetings in Washington, G+D has confirmed.
Known as the digital ouguiya, the potential CBDC would complement cash. However, the central bank hasn’t committed to developing the digital currency, and the partnership only aims to “gain a clear understanding of how a digital Mauritanian Ouguiya could benefit society and the country’s economy.”
If the central bank decides to pursue the project, G+D will support it in establishing the requirements of a CBDC and offer technical solutions to underpin the digital currency.
Mauritania’s 4.7 million residents rely heavily on cash for payments. According to the World Bank, over 75% of the country remains unbanked, with financial services primarily available in major urban centers. Smartphone penetration is estimated at 20%.
This poses an additional challenge for the digital ouguiya. While many central banks are conducting research on offline payments, CBDCs are mostly restricted to internet-enabled devices.
Despite the challenges, central bank governor Mohamed Lemine Ould Dhehby considers the digital ouguiya a crucial part of his country’s digital transformation agenda.
“The Banque Centrale de Mauritanie has strategically positioned itself for the potential launch of a digital currency. Through the exploratory work we have now agreed, we are expanding our knowledge base, skills and experience. G+D’s expertise in this innovative, rapidly developing field will help us to bring it to life for the benefit of the whole country,” he commented.
G+D has become a significant player in the CBDC industry. The German firm has worked with Thailand’s central bank on the digital baht and with Brazil on offline solutions to its digital real. In Africa, the company has worked with Ghana on its CBDC.
Commenting on the partnership, G+D CEO Wolfram Seidemann stated that Mauritania’s potential digital currency is “of critical importance for economic and social progress.”
“With our fifty-year business relationship, we are all the more honored to be able to support the Mauritanian central bank also in that context, providing specialist knowledge and expertise from our many CBDC projects,” he added.
Mauritania joins Ghana, South Africa, Tunisia, and over a dozen other African nations exploring digital currencies. Its West African counterpart, Nigeria, remains the only nation in the continent to launch a CBDC—the eNaira.
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.
Watch: Finding ways to use CBDC outside of digital currencies
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