As October 1 nears for the much anticipated e-Naira to be unveiled, the Central Bank of Nigeria (CBN) has started outlining guidelines for the digital currency. Nairametrics reported that the apex bank has sent a presentation to Nigerian banks about the e-Naira project, revealing more details about its design and operational module. The apex bank has also hired a technical partner, Bitt Inc.
According to the report, the Central Bank Digital Currency (CBDC) status of the e-Naira makes it a legal tender as it serves the same purpose as the fiat. However, the rules as outlined by the CBN separates them in some ways.
The report states that the e-Naira is a legal tender for the entire country and it will have non-interest-bearing CBDC status, a transaction limit for customers, and a value-based transaction limit.
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Participants in the e-Naira program are featured in five stages, including:
Monetary Authority Suite: The Central Bank will be handing the first product component that includes issue, distribute, redeem and destroy the currency. Store data on a cloud server, monitor and analyze currency transactions.
Financial Institution Suite: licensed financial institution will be able to request currency or issue stablecoins, manage digital currency across branches, KYC, identify and AML compliance capability.
e-Government Suite: the government will be able to efficiently process digital payments sent to and received from citizens and businesses.
Merchants Suite: Merchants will provide low-cost payment and business management software, POS, remote payment solutions, online capabilities, transaction analysis and reconciliation.
Retail Consumer Suite: features user-centered designs for a great user experience. The architecture will be expandable to enable innovation; features advanced privacy and security.
Besides these, the CBN also outlined the proposed transaction cost for the e-Naira wallet.
The report highlighted other regulatory guidelines including that the digital currency infrastructure does not charge for user-to-merchant transactions and P2P wallet transactions.
Also, that it shall be the responsibility of Nigerian banks to promote and market the centrally issued digital currency as a cash alternative to existing and potential customers in support of the Nigerian apex bank’s goal for financial inclusion.
In order to catalyze the adoption of the e-Naira, banks will facilitate onboarding and provide world-class customer service.
Nigerian banks will be allowed to invite all their customers to register for the e-Naira. Besides pre-generated codes, the banks can send invitation codes for onboarding to a specific list of selected customers. Onboarding will be done for customers who have a code assigned by their banks. The banks have already validated and verified these customers.
The apex bank said the wallet provided by its institution was merely a stop-gap measure for meeting the deadline, given that banks and other licensed operators may provide their own wallets since it didn’t intend to compete against the banks, the report said.
And as part of the digital currency initiative, the NIBSS and other switching platforms will still be relevant, existing infrastructure can be integrated and leveraged in the e-Naira implementation.
Also, 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.
According to a further report by Nairametrics, the central bank announced three “Speed wallet” levels issued primarily to meet the October 1st deadline.
The wallet doesn’t compete with existing banks, but it stands in place whilst banks and other players create more wallets.
With the first tier, Speed Wallet can be used by anyone who does not have a bank account. However, users will have to submit a passport photo, a name, birth date and place, a phone number, and their address.
A fifty-thousand-naira limit is in place for Send & Receive, the minimum requirement is the individual’s National Identity Number (NIN), which will be validated. A cumulative balance of three hundred thousand naira is fixed each day.
For Tier Two Wallets, an account with an existing bank and Bank Verification Number (BVN) are the minimum requirement. The user is limited to sending and receiving two hundred thousand naira per day with a Cumulative Balance of half a million naira daily.
Tier three allows daily transactions of a million naira, with daily cumulative balances of five million naira. Just as tier two, the user requires at least a BVN.
Those who possess this merchant level can send or receive a million naira daily. The rules allow merchants to move as much money as they want into their bank accounts. However, the CBN notably did not make room for cryptocurrencies, affirming the stand it had taken on the digital assets earlier in the year.
It’s not clear how this could help the naira retain value, the whole thing felt like running a parallel operation, just to show that you are present and can do something.
The banks seem to be front and centre in the whole scheme, and they are tasked with providing world class experience…
If a bread is sold for N500, will paying with e-naira bring it down to N400? And when the price changes to N700, will the e-naira move also, and by what margin? Will the issuance of e-naira have maximum limit, or will it be infinite like the fiat?
Hopefully we won’t waste a lot of money on nothing, the new dawn is here, congratulations to Nigeria!
I thought i was the only one thinking this way
I was asked this morning, how the E-naira will increase Financial Inclusion, especially at the Bottom of Pyramid, and i don’t see one single way
A cryptocurency that can not be traded for more valuable existing ones, how do Nigerians gain value from it how can they trade in/with it, how stable would it be? These questions and many more would arise. Well for everything that can be better, this is a start.
That’s good news for the take up of e-naira strategy
A welcome development, I wouldn’t want to state view now; reason being that once it’s initiated the would be rooms for modification and futuristic open opportunities.
Congrats Team Nigeria ??
Is there room for investment into e-naira?
I do not think so, as it doesn’t bear interest. However it might be possible that increase in its valuation will make it profitable for holders.
not be traded for more valuable existing ones, how do Nigerians gain value from it how can they trade in/with it, how stable would it be? These questions and many more would arise. Well for everything that can be better, this is a start.
This solves no financial problem ravaging Nigeria economy. Seems like another looting scheme made easy for already corrupt public officials.
This is another way to loot money for those in high power.
We are in digital era, it is good and nice to have a digital currency to up our economy
I need money
Don’t do this tns
God lead Nigeria aright!
Nigeria has starting and we don’t have finishing. Don’t just wasted our money for unreasonable platform. We can continue to deceive our self.
Can I use my e-naira wallet to make online transactions? What would be it’s FX rate?
What benefits do I stand to gain from it as against using the fiat.
Well, let’s see as things evolve and take shape.
The new development comes with a lot of questions on the Nigerian economy, among which are: how would it increase the value of Naira, increase the standard of living of the common man, and hope it’s not another scheme for embezzlement? May God help Nigeria!