Nigeria Targets Unbanked Citizens as its Pushes for e-Naira Adoption
- Nigeria is the first African country to launch its own digital currency, the e-Naira.
- Despite a ban on crypto transactions, Nigeria has one of the fastest-growing crypto markets in the world.
- Many Africans prefer to earn and save in cryptocurrencies such as stablecoins to hedge against their declining economies.
The Central Bank of Nigeria has announced plans to push for the adoption of the country’s digital currency, the e-Naira. According to the CBN governor, Godwin Emefiele, the e-Naira is set to enter into its second phase of adoption and will feature improved technology to accommodate the needs of its users.
Godwin explained to the audience at the 2022 e-Naira Hackathon in Abuja that the e-naira was not a one-time event and would be subject to frequent improvements. The e-Naira, which was launched in October 2021, is Africa’s first Central Bank Digital Currency (CBDC).
The CBN Governor said during his speech,
The second phase of the project has begun and is intended to drive financial inclusion by onboarding the unbanked and underserved users […] with a target of about 8 million active users.
The CBN boss further noted that starting next week, Nigerians can conduct transactions on the e-Naira wallet through the Unstructured Supplementary Service Data code (USSD) on their mobile phones. Users must dial *997# to conduct transactions from their phones.
Nigeria Pushes for Expansion of the Digital Payment Market
The Central Bank of Nigeria issued the e-Naira as legal tender and anticipates wide adoption in the coming months. The new features on the digital currency would grant users more options besides conducting transactions. According to the CBN Governor, Nigerians can also open an e-Naira wallet on any phone they choose using the designated USSD code. Through this upgrade, the Central Bank of Nigeria intends to grant more Nigerians access to financial services.
Speaking of the CBN’s plans to foster financial inclusion in the country, Godwin said,
The CBN will increase the level of Financial Inclusion in the Country because just like the Naira, the eNaira is expected to be accessible to all Nigerians. And would provide more possibilities to bring in the unbanked into the digital economy.
Nigeria has held an uptight stance against cryptocurrency transactions but appears to embrace digital payment. The Nigerian Central Bank banned crypto transactions in February 2021, ending hopes that the country might adopt Bitcoin as legal tender.
However, despite this ban, several Nigerians have remained active in the crypto market. A report by crypto research firm, Chainalysis, revealed that the crypto market in Nigeria and Africa grew by over 1000% in one year. At the time, Africa was reported to have the third-fastest crypto economy in the world.
Throughout 2021, Nigerians traded more than N316.9bn worth of Bitcoin on Paxful. Nigerians had more than six million crypto transactions and 16,000 daily transactions, making them the number one nation on the platform.
A recent report also revealed that Nigerians are the most crypto-curious nation since the market crash of April. Many Nigerians have turned to the crypto space to combat their declining economy. According to reports, Nigerians prefer to earn and save in crypto, especially stablecoins. Others identified savings as their primary interest in cryptocurrencies.