Two sources familiar with the matter said the central bank is willing to develop its own software for the CBDC in order to maintain full control of the effort.
It has been almost eighteen months since Nigeria launched its central bank digital currency (CBDC) eNaira in October 2021. Now, the Central Bank of Nigeria is planning for a technological renovation of your CBDC.
Currently, the central bank of Nigeria is in discussions with potential technology partners who can develop a system to run and manage its CBDC. Two sources familiar with the matter said the central bank is willing to develop its own software for the CBDC in order to maintain full control of the effort.
One of the sources also claimed that the central bank is in initial talks with New York-based technology company R3. Initially, Bitt Inc. helped Nigeria issue its central bank digital currency, making it the first country on the African continent to implement a CBDC.
The source said the new partner is not looking to take the job of Bitt Inc. Instead, it would help the central bank meet its goal of controlling CBDC technology. Commenting on the development, Bitt Inc. noted that it “is aware that our partner, the CBN, works with various service providers to explore technical innovations for their digital infrastructure.” The company further explained that it is working closely with the Nigerian central bank on developing “additional features and enhancements.”
Nigeria Struggles to Boost eNaira CBDC Adoption
Although Nigeria has been at the forefront of initiatives to support blockchain-based versions of its national currency, it has struggled to drive widespread adoption of its CBDC e-Naira. Currently in Nigeria, only one million people out of the total population of 200 million have downloaded digital wallets to store eNaira.
The Central Bank of Nigeria itself stated that eNaira transaction volumes have been negligible. Now, with the redesign of e-Naira and the cashless policy introduced four months ago, the regulator is looking to boost CBDC adoption.
Nigeria has recently faced severe economic challenges in the central bank’s effort to move to a cashless economy. The Central Bank of Nigeria’s decision to demonetise high-value notes to absorb excess cash has backfired, with individuals and small businesses facing the most.
Critics of CBDCs have raised concerns that they could destabilize trade bans and would exclude consumers and businesses that still rely on cash.
next
Bhushan is a FinTech enthusiast and has a good knack for understanding financial markets. His interest in economics and finance draws his attention to the new emerging markets of Blockchain technology and cryptocurrencies. He is continuously in a learning process and stays motivated by sharing the knowledge he has acquired. In his spare time, he reads thrillers and sometimes explores his culinary skills.
