More than a year after it launched its central bank digital currency with partner Bitt Inc, the Central Bank of Nigeria is looking for a new technology partner. The new partner is expected to help the central bank implement a system that will give it greater control of the digital currency. One expert said the central bank should consider improving the user experience if it wants more Nigerians to adopt e-naira.
Control of the underlying technology of E-Naira
The Central Bank of Nigeria (CBN) is looking to install a new system to run its central bank digital currency (CBDC) and is currently talking to potential technology partners, according to a report. According to a reportthe central bank is interested in developing digital currency technology that gives it greater control of the CBDC.
R3, a technology and business services provider, is one of the potential partners that has reportedly discussed implementing a different technology for e-naira. According to the report, CBN’s chosen partner is not expected to immediately remove the central bank’s initial technology partner, Bitt Inc. Instead, the central bank hopes the new partnership will help it achieve its goal of controlling the underlying technology of CBDC.
While no official comment has been made on CBN’s plans, Bitt Inc acknowledged that Nigeria’s central bank is “working with various service providers to explore technical innovations for its digital infrastructure.” Despite this, the Barbados-based tech firm said it still works closely with CBN and is “currently developing additional features and enhancements.”
Commenting on the plans reported by CBN, Lucky Uwakwe Arisukwu, CEO of fourth industrial revolution technology hub Sabi Group, agreed that the central bank’s desire to control digital currency could be the main motivating factor. To support this view, Uwakwe referenced the recently released national card scheme known as Afrigo.
Like e-naira, the Afrigo scheme seeks to strengthen the country’s national payment system and deepen the use of electronic platforms in Nigeria. Although the CBN governor has rejected claims that the card scheme seeks to drive out international service providers, Uwakwe argued that the central bank could not have launched this scheme if it lacked control. According to Uwakwe, the CBN wants to apply the same approach to e-naira.
Strengthening the E-Naira
Despite being Africa’s only functioning CBDC, e-naira adoption has been slow, and according to a Bitcoin.com News report from August 2022, just under a million e-naira speed wallets had been downloaded. at that moment. The tepid response from the Nigerian public reportedly prompted CBN to look for ways to get more Nigerians to download the e-naira fast wallet.
My experience with eNaira and the current problem of banknote shortage in Nigeria @cenbank already gave us a solution even before the problem started
While not 100%, it is very useful and a win for most of the public who queue up at the bank ATM and a win for @cenbankhttps://t.co/14wHBsFLjn
— Lucky Uwakwe (KING of DeFi/NFT/SocialFi/GameFi (@luo2027) February 3, 2023
One of the ways that CBN has tried to achieve this is by offering rewards to residents or merchants who accept the e-naira. In addition to these incentives, Uwakwe said that CBN should also work to improve the user experience if it wants more Nigerians to use CBDC.
“If the user experience is improved, they would definitely have great adoption. The central bank should also consider, for example, requiring all civil servants to receive a portion of their salary paid in the e-naira format,” Uwakwe said.
The Sabi CEO also pointed out how the failure or reluctance of commercial banks to allow seamless conversion from e-naira to fiat naira and vice versa is possibly working against CBN’s efforts.
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