Nigeria: eNaira – Experts Suggest Ways to Increase Digital Currency Penetration

Experts in the digital currency space have agreed on ways to deepen acceptability of digital currency in Nigeria, especially the Central Bank of Nigeria owned eNaira. They were unanimous on that fact that inclusion of the unbanked into the financial sector is made possible by providing technologies as long as the appropriate operational models and regulatory frameworks are implemented.

Founder, Blockchain Centre and CEO of Bitcoin Sam Lee said the progress of eNaira can be enhanced by stable coin regulation to create healthy competition to the existing government-backed eNaira system.

Lee said to increase digital currency penetration into the market would mean that there has to be a stable coin framework so that the market can create competing systems to the eNaira. “Competition is great if it’s from the private sector,” he said, “but under regulatory regime.”

He is also the chairman of blockchain lab under the China Academy of Science, which is the largest research institute in the world. It drives the adoption of digital currencies in the Chinese domestic market.

Speaking at a pre-conference virtual meeting with the theme: “Building a Cashless Syatem: Understanding the Digital Currency, Lesson from eNaira,” the experts say Nigeria and indeed Africa need to urgently create cashless economy that is driven by technology.

“So, if there is a strong private sector competition.

celerate the digitisation of money. Which is a process that will bring welcome prosperity and accelerating transactions in the ecosystem,” Lee said, adding that “Stable coin regulation in Nigeria, released by the Nigerian central bank and the Nigerian central government would work.”

Rakiya Mohammed who oversees the information technology department of the CBN disclosed that there 36 million people in the financial sector in Nigeria. She said the engagement will help to deepen the goal of the eNaira.

Mohammed highlighted the many security steps already taken to ensure that the process is not manipulated but secured end-to-end.

She said “if we are able to get most of the informal sector into the financial sector, we would be able to measure our GDP based on their contribution.”

Chairman & president of Future Trends Group Farzam Kamalabadi said there is future possibility of loops of currencies converging with each loop being added to the value, “this is what we plan to build in Africa.”

He said the future trends of cashless payment is when new emerging economies have the chance to bypass what classic economies are doing.

Kamalabadi said the benchmark is to create economy in Nigeria that is $1 trillion as soon as possible. “Nigeria is close to that; it only needs a triple economy. 20 other African nation’s need to have within seven years, a $1 trillion economy plus a $1 trillion sovereign wealth fund; same size as Abu Dhabi Investment Authority. Each of the African countries already have the wealth but it is not actualized,” he stated.

Global advisor of Global Chamber & the CEO of ONS Triumphs Ltd Ogbonna Ukuku said here should be a more creative way of getting funding to support fintech in Africa. There must be a profit in that transaction. He said investors have a particular attitude who invest only in where they can make their money back.

On his part, CEO of Actionable Strategy Jeffrey Wu said Africa can leapfrog western payment systems by skipping bank and credit card accounts and moving directly to digital-only accounts using mobile/Web first platforms.

“A durable and scalable approach requires operational discipline, pragmatic regulations, prudent risk management, and realistic expectations. This extends to all stakeholders: individuals, merchants, larger vendors, and governments (as payors, payees, and regulators). In addition to utility and cost, adoption also requires trust. Knock-on benefits from innovation can then be realized,” he said.


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