Nigeria’s central bank reveals official guidelines to country’s CBDC project

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The Central Bank of Nigeria (CBN) is the latest regulator that is branching its interest in unveiling a central bank digital currency (CBDC). The CBN has released preliminary guidelines to the country’s local banks on the CBDC project dubbed the e-Naira. It has been reported that this is going to be implemented in five stages. 

The draft document which is handled by Nairametrics states that the design and structure of the project’s completion will cause it to be seen as a declared legal tender in Nigeria. 

The proposed project has been segmented into Monetary Authority Suite, Financial Institution Suite, eGovernment Suite, Merchants Suite, and Retail Consumer Suite. 

CBN will focus on main elements, which includes Know Your Customer (KYC) systems, cloud servers’ stability, merchants’ and consumers’ testing. And this will further help in determining the coin’s feasibility. The proposed central bank digital currency will offer parity of value and will operate as a non-interest-bearing CBDC. It has been noted that the document also outlines the e-Naira wallet testing that will also imply transaction costs. It also plans to involve several citizens to test the coin through domestic banks. Even though it is not conclusive, the bank wants to include Merchant Suite in the e-Naira testing phase. The suit also seeks to offer point-of-sales and remote payment solutions for the CBDC transactions. 

The report stated, “As a National Critical Infrastructure, the e-naira system will be subject to comprehensive security checks, all data and personally identifiable information (PII) will be kept off the ledger and will not be stored on the ledger.”

The CBN will be also be partnering with Fintech firm Bitt Inc concerning the project so that it could offer technical support for the e-Naira project. The CBN has stated this as a decision to consider a CBDC and claimed, “Given the significant explosion in the use of digital payments and the rise in the digital economy, the CBN’s decision follows an unmistakable global trend in which over 85% of central banks are now considering adopting digital currencies.” This project when completed is definitely going to be beneficial and successful for crypto users and customers.

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