eNaira: Nigeria’s Digital Currency
By Opeyemi Solaru
On Monday, October 25, President Buhari announced the Central Bank Digital Currency, eNaira. This is not to be confused with cryptocurrency, as it is not decentralized and is backed by the Nigerian government. The purpose of the eNaira is to have a digital version of the naira that could be “interchangeable with the physical naira for everyday transactions,” according to Quartz Africa.
This was developed by Bitt, a fintech company based in the Caribbean. Buhari stated that the new e-currency would boost the Nigerian economy by $29 billion in the next decade. Presently, the eNaira is equivalent to 1 naira. The CBN will provide eNaira to financial institutions, who will then administer the identification process, payment processing and generation of electronic wallets.
However, just 48 hours after its announcement, eNaira was removed from the Google Play store. This was following 100,000 downloads and thousands of bad ratings on both platforms. The app has since been restored on the Google play store and has still been available on the Apple store as of now, as well as the eNaira merchant wallet.
Many have criticized the app’s customer experience, claiming that during registration, there was no way to match one’s bank verification number (BVN) to their emails. Additionally, the terms & conditions given by the CBN caused some distrust amongst Nigerian users.
However, despite the initial backlash, the eNaira still has great potential, especially in this “digital economy.” Other African countries, such as South Africa, have identified the potential of having a successful digital currency. It can also promote financial inclusion throughout the country. South Africa has fully launched an e-currency, but instead has developed a pilot study called Project Dunbar — a plan to enable financial institutions or make transactions quicker and easier.
Perhaps, Nigeria can also consider testing eNaira on a smaller population to iron out the kinks before releasing it to the entire country. Furthermore, educating its citizens on the benefits and details of the eNaira would surely go a long way. Once the Nigerian government is able to resolve the issues surrounding the eNaira, Nigeria will likely be well-positioned for economic growth and development in the future.