As was announced on the Central Bank of Nigeria Twitter account, Nigeria is adjusting its strategy with the eNaira in an attempt to expand the usage of the central bank digital currency (CBDC). Despite a promising rise in the number of eNaira wallets, the numbers fall short when considering the country’s vast population of nearly 224 million.
The eNaira was rolled out in October 2021, and since then, the number of eNaira wallets climbed from a modest start to a respectable 13 million by March this year – a sizeable leap signifying over 12 fold increase. While the climb is noteworthy, it’s clearly inadequate to make a substantial impact on the country’s economy, especially if weighed against Nigeria’s population.
To enhance the currency’s adoption and improve user experience, steps to upgrade the eNaira’s app to support contactless payments have been taken, as noted in a report by local news agency The Sun. Yet, the bank left its patrons in anticipation, as it draws curtains over specifics of the planned changes to the eNaira model and the necessary details remained unattended till the end of day.
The challenge of integrating the eNaira into everyday Nigerian life highlights some deeper issues within the country’s economic structure. By March, the total value of eNaira transactions had only reached 22 billion naira, a mere smokescreen when compared to the country’s colossal $220 billion cash-reliant informal economy. The suboptimal infrastructural facilities render the vast terrain of commercial arenas eNaira-averse, thus an impediment that could stymie the digital currency’s spread.
The predicament is evident – while steps towards digital currency spark an era of revolution in the monetary landscape, ensuring widespread adoption amidst a thriving, but cash-dependent informal economy presents its own share of difficulties. It’s quite clear that the Central Bank of Nigeria’s intentions to broaden eNaira usage and turn the tide around are certainly laudable. However, the process seems to be a complex blend of strategy adjustments, infrastructural makeovers, and perhaps a certain degree of patience. The true test here would be how adeptly these modifications are implemented and how efficiently they address the challenges at hand.
Source: Coindesk
