IMF sees room for improvement in eNaira in first-year valuation
The world's second largest CBDC has yet to reach 1% of Nigeria's population, according to IMF assessment.
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Nigeria's central bank digital currency eNaira (CBDC) is over a year old, and the International Monetary Fund (IMF) has given it a belated birthday present in the form of a working paper appraising his first year of performance. "Laudable," the IMF researchers said of eNaira's first year, but there were also some suggestions.
The eNaira was the second CBDC in the world, created in October 2021, after the Bahamian dollar. The document revealed that the retail side of eNaira was middle-of-the-road, but had no latency issues, as it has yet to break through beyond its initial adopters. The Central Bank of Nigeria introduced a phased introduction, which delayed two of the biggest goals of the CBDC, extending financial inclusion to the unbanked and facilitating remittances, according to IMF officials.
Related: eNaira is 'crippled': Nigeria is in talks with a New York-based company for an overhaul
Only about 1.5% of wallets are active each week, and there were only a total of 802,000 transactions during the period under review. The numbers represent less than one per wallet, and less than 1% of bank accounts in the country have wallets. The newspaper observed:
"Like any network product with similar characteristics (e.g. a credit card), breaking the initial balance of low adoption requires a mix of smart strategies and luck."
Mobile money operators (MMOs) have a large network in Nigeria, and eNaira's relationship with this network is a key issue raised in the article. CBDC could compete with MMOs in the retail market or facilitate...
The world's second largest CBDC has yet to reach 1% of Nigeria's population, according to IMF assessment.
News
Join us on social networks
Nigeria's central bank digital currency eNaira (CBDC) is over a year old, and the International Monetary Fund (IMF) has given it a belated birthday present in the form of a working paper appraising his first year of performance. "Laudable," the IMF researchers said of eNaira's first year, but there were also some suggestions.
The eNaira was the second CBDC in the world, created in October 2021, after the Bahamian dollar. The document revealed that the retail side of eNaira was middle-of-the-road, but had no latency issues, as it has yet to break through beyond its initial adopters. The Central Bank of Nigeria introduced a phased introduction, which delayed two of the biggest goals of the CBDC, extending financial inclusion to the unbanked and facilitating remittances, according to IMF officials.
Related: eNaira is 'crippled': Nigeria is in talks with a New York-based company for an overhaul
Only about 1.5% of wallets are active each week, and there were only a total of 802,000 transactions during the period under review. The numbers represent less than one per wallet, and less than 1% of bank accounts in the country have wallets. The newspaper observed:
"Like any network product with similar characteristics (e.g. a credit card), breaking the initial balance of low adoption requires a mix of smart strategies and luck."
Mobile money operators (MMOs) have a large network in Nigeria, and eNaira's relationship with this network is a key issue raised in the article. CBDC could compete with MMOs in the retail market or facilitate...
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