Nigerian lenders have been putting up roadblocks against using the country’s digital currency, concerned about loss of revenue from traditional banking services, Central Bank of Nigeria Governor Godwin Emefiele said Tuesday (July 19).
The central bank has said only around 700,000 customers made an e-Naira wallet since they were debuted last year, though there are around 55 million bank accounts in the country, Bloomberg reported.
On the whole, e-Naira transactions are still unpopular in the country, even though they do not incur a charge, unlike transfers or payments done through a bank’s platform or website. The report noted that e-Naira wallet deposits don’t count as cash in the lender’s books.
Per the report, Emefiele said there was “apathy” at the banks, as banks feel that the e-Naira cuts down on banks’ work with mobile banking services to add more revenue. Emefiele also said the central bank was almost done with tests with MTN Group’s Nigeria unit to make a channel to allow Nigerians without bank accounts to open e-Naira wallets.
PYMNTS wrote last August about the initial idea to create an e-Naira, noting that the currency would have a legal tender and non-interest-bearing asset status. It would also put a limit on both the customer and value-based transactions.
There were five stages initially identified as part of the rollout, including one for “issuing, distribution, redemption, as well destruction of the currency.” The second had to do with letting financial institutions request currency, and the third would see the government processing digital payments made in retail.
The fourth stage saw businesses looking into low-cost software for dealing with the coin, and the last stage had to do with the “architecture” of the currency, which would give more attention to advancements for privacy and security.
It also came as the Central Bank of Nigeria had received backlash from the public just a few months before the announcement, as it had banned cryptocurrency transactions in February 2021 citing their “unregulated and unlicensed” status.