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CBN Set To Launch Digital Currency In October

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The Central Bank of Nigeria (CBN) has revealed it will launch the pilot scheme of its digital currency on October 1st, 2021. The resolution was made during a private webinar on Thursday in which CBN and its stakeholders outlined a digital currency initiative. Central Bank Governor, Godwin Emefiele had earlier announced that the bank will be working on a central digital currency during the 306th Banker’s Committee meeting. At the end of the meeting CBN Director, IT Department, Mrs. Rakiya Mohammed, revealed that the bank had been conducting research in regards to central bank digital currencies since 2017 and may conduct a proof of concept before the end of this year. According to Mrs. Mohammed the project is named ‘GIANT’ and will use the Hyperledger Fabric blockchain. The Hyperledger Fabric is an open-source project that acts as a foundation for developing blockchain-based products, solutions, and applications using plug-and-play components that are aimed for use within private enterprises.

She further said the digital payment instrument would further improve payment efficiency, revenue tax collection, remittance improvement, and targeted social intervention.

She added that the innovation would also benefit the fintech ecosystem by enhancing operational efficiency, opportunities for fintech start-ups in building services and products as well as financial inclusion that will contribute to economic growth, and the creation of a new system complimenting the traditional payment system.

Mrs. Mohammed had last month said the proposed digital currency would be launched before December.

Just last week China’s digital yuan trial has reached 34.5 billion yuan ($5.3 billion) in transaction value as the central bank continues to outpace global peers in developing a virtual currency.

Across China, more than 20.8 million individuals have opened a virtual wallet that stores the digital currency and have made over 70.7 million transactions in total, the People’s Bank of China in a white paper published Friday. The central bank said it will continue to test and build up the system, but won’t set a timetable for its official rollout.

As for CBN’s digital currency, once the pilot scheme is eventually launched, Nigeria will join other countries across the globe and Africa including South Africa (digital Rand), Tunisia (eDinar), Ghana (e-cedi), Sweden, Japan, South Korea, and Russia, in the race to develop its CBDC.

 

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