CBN targets financial inclusion with eNaira for Nigerians without internet-enabled phones

THE Central Bank of Nigeria,(CBN) has said that Nigerians without internet-enabled platforms will still make transactions in the e-Naira project as part of efforts to widen financial inclusion.

The apex bank said it had conducted research prior to the unveiling of the e-Naira project, noting that many Nigerians could be left out of financial inclusion if access was not provided for non-internet-enabled phones.

The bank recently unveiled the eNaira to promote digital currency, facilitate financial flows within and outside the country, while ensuring that the economy is not dollarised, amid concerns of the dwindling fortunes of the naira.

The apex bank also said the project would be able to track illicit financial flows and deepen banks’ ‘know your customer status’ for transactions effected by customers.

The CBN, in a document titled, ‘Design Paper for the  Naira,’ released on Wednesday night said the e-Naira was developed based on simplicity and ease of use to ensure that Nigerians without internet-enabled phones could access the service.

“According to the National Commission for Mass Literacy, Adult and Non-formal Education, NMEC, 35 per cent of the nation’s adult population was illiterate(i.e37 million) and the CBN risks losing adoption to the segment of the population,” the CBN said.

“To mitigate this risk, the bank factored in the need for inclusiveness as part of the core design principle of the eNaira.”

The apex bank further stressed that in order not to exclude many Nigerians in this category, it factored in the need for inclusiveness as part of the core design principle of the eNaira.

It further noted in the document that the principle had enabled the bank to focus on simplicity and ease of use, ensuring that Nigerians without internet-enabled phones could access the service.

The bank said eNaira would complement existing payment methods such as mobile banking apps, point-of-sale terminals, USSD, FAST response code, and internet banking.

“The account-based CBDC model at its core mirrors the progress made on the National Financial Inclusion Strategy, which enables access to financial services by leveraging last-mile networks to identify users and to provide banking services such as the BVN, NIN, TIN, etc to uniquely identify individuals and corporate entities.”

The apex bank noted that identifying frameworks such as the NIN would enable access for the financially excluded as they could be uniquely identified, thereby enabling the provision of financial centres.

Many industry watchers have drummed support for the policy, noting that it will encourage more usage of naira for transactions at a lower cost



    Economist Kalu Aja noted that the eNaira had a low-cost advantage when compared to FIAT.

    “The daily transfers between accounts are at no cost to the holder of the account. Lower transaction cost is a massive incentive as traders will pay no fees for withdrawals and deposits to and from their bank account. No transaction fees reduce the cost of commerce while improving safety,: Aja said.

    The e-Naira will be integrated into the CBN’s foreign exchange process, making it easier for Nigerians to receive remittances, he said.
    Aja further explained that transfers could be from the CBN crediting e-Naira directly to the International Money Transfer Organisation (IMTO).
    “A Nigerian abroad sending $100 to his uncle can debit his US bank account and credit $100 to an IMTO, who will buy eNaira from their corresponding Nigerian bank. The $100 is converted to e-Naira instantly at a far lower transfer fee which is a real benefit and a significant advantage the e-Naira will enjoy,” Aja said.

    Development Economist and Associate Consultant for the British Department for International Development (DFID) Celestine Okeke told The ICIR that beyond the eNaira policy of the CBN, the government must ensure the naira was strengthened by giving manufacturers a competitive edge in an export-driven economy.

    “There must be a focus on export and non-oil beyond the promotion of digital currency,” he said.

    Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.

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