The central bank digital currency (CBDC), popularly known as e-Naira, is growing faster than experts expected. After its launch in October 2021, it was met with skepticism as Nigerians wondered what it was about when internet banking was already part of the monetary system.
Little did many know that e-naira, a non-physical currency, is different from internet banking. A cross-section of them thought it was the same as a cryptocurrency like Bitcoin, Ethereum, etc. that the Central Bank of Nigeria (CBN) warned about as being unregulated.
Even some economists and academics have expressed doubts about the rapid adoption of the e-Naira. Some concluded it was another failed government project. But CBN had ideas. The first was to educate Nigerians about the difference with cryptocurrency.
Apex Bank has educated the public on the difference between internet banking and digital currency, stating that sending and receiving money with e-Naira is cheaper and protected from network issues related to internet transactions.
Funds held in e-naira wallets are more secure than funds held in traditional commercial bank accounts. This is because the banking system or a specific bank can collapse and depositors may lose their money, but the state-owned CBN cannot collapse.
In addition, Apex Bank used all of 2022 and the first quarter of 2023 for heavy marketing to attract new users. Advocacy teams went across the country to meet Nigerians in different fields and demonstrate how it works.
The outcome of awareness workshops, held for artisans, drivers, teachers and market women, among others, was presented by CBN Governor Godwin Emefiele following the recent Monetary Policy Committee (MPC) meeting. He said the value of e-naira transactions has reached 22 billion naira, up 68 percent since January.
“More than N10 billion of these have been minted and currently around N3.429 billion are in circulation. The number of wallets created so far has also increased to 13 million. We’ve seen good progress on adoption.
“We’re excited that e-Naira remains one of the very viable options that everyone can use as we try to move more towards financial inclusion and stop people from being left out of the financial system,” he said.
Emefiele added that the 13 million wallets created over the past 18 months have been categorized by their level of usage. There are 12.6 million on Tier Zero; 11,354 on Tier 1; 367,000 were at Tier 2, while the remaining 9,649 were at Tier 3 usage levels.
The CBN boss assured that everything is being done to improve the platform and observed that the approval rating of the digital currency keeps increasing. More Nigerians jumped onto the platform at the height of the naira shortage ahead of the general election, analysts said.
To mark the one year anniversary of the launch of the CBDC in October 2021, Emefiele announced that the e-Naira app had over a million downloads, a testament to the immediate success, confirmed by the business magazine Economic Confidential.
Industry officials say the CBN has done an impressive job of selling e-Naira and gaining the trust and interest of previously skeptical individuals. Apex Bank had said it would focus on individuals and groups at the bottom of the career ladder in terms of education and financial resources.
The acceptance and impact of the digital currency is indeed remarkable. Although it is an excellent sales idea, its gradual dissemination has been made possible by those responsible for advocacy, aware of their responsibilities and knowing how to strike the right tone at the right time and in the right place.
Abdulrahman Abdulraheem is a financial journalist
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