Nigeria's central bank unveils 'eNaira' digital currency

By Tuba Sahin

ANKARA (AA) - Nigeria launched its central bank digital currency (CBDC) the 'eNaira' on Monday in a bid to enhance its payments system.

The eNaira will complement cash as a less costly, more efficient and generally acceptable safe and trusted means of payment, the Central Bank of Nigeria (CBN) said in a statement.

It will improve monetary policy effectiveness, enhance the government's capacity to deploy targeted social interventions and boost remittances through formal channels, the bank added.

The move will help Nigeria, the first country to launch a central bank digital currency, to make financial transactions easier and seamless for every strata of society.

"The main purpose is to bring in those who are outside the banking system, to include them in the financial system," Sant Manukyan, head of the Investment International Markets Department with Turkey’s biggest private lender Is Bank, told Anadolu Agency.

Manukyan warned, however, that digital currencies have risks such as price volatility in times of crisis besides their positive aspects such as low transaction costs and storage features.

If governments remove cash completely, central banks will be able to see everyone’s transactions, so there will also be a privacy issue, he stressed, adding that it might pave the way for banks to reduce interest rates to below zero.