eNaira adventure must work for Nigerians

It is no longer news that the Central Bank of Nigeria (CBN) was set to launch the eNaira, a digital currency minted and controlled by the apex, but abruptly postponed it without setting a new date.

The CBN spokesperson, Osita Nwansiobi claims the postponement was in consideration of the Independence Day celebrations by the Nigerian government.

“The planned unveiling on October 1, 2021, has now been deferred due to other key activities lined up to commemorate the country’s 61st Independence Anniversary,” Nwansiobi said.

But there is a report by Nairametrics citing sources in the CBN said that the launch was deferred due to a sustained surge in traffic on the eNaira website. The report notes that eNaira website saw 480,000 hits the first day it went live. The visits grew to 1.7 million and have averaged over 2.8 million hits daily since then. The website has also recorded a surge in usage with the time spent on the site generating content of over 80 GB daily. The CBN was forced to carry out a stress test on its systems to ensure it is capable of withstanding a further surge in traffic when they go live.

There is also a concern that the eNaira is subject to trademark infringement following a suit filed by ENaira Payment Solutions a company that claims that it first registered the name before the CBN commenced the project.

For a project that could impact the performance and direction of the economy, we think these issues do not bode well and should be addressed immediately. The eNaira is projected to bridge gaps in financial services such as ease of diaspora payments, receiving financial support and intervention funds through the digital wallet; increasing customer base for financial institutions and businesses.

As a digital currency, the eNaira is for everyone, individuals, households, businesses, non-governmental organisations (NGOs), religious institutions, and governments at all levels, as it enables customers to money from their bank to their eNaira wallet with ease.

Read Also: CBN suspends eNaira launch

Nigeria cannot afford to get it wrong this time as many things are riding on it. Remittance remains one of the major sources of foreign exchange for Nigeria. A report from Agusto Consulting on diaspora remittance showed that Nigeria has over $21 billion annually in inflows making it the second-largest recipient of remittance on the continent, only after Egypt. Diaspora remittance also represents the second-largest source of foreign exchange inflow into the country, second only to crude oil earnings.

In recent times, the country saw that revenue sources decline significantly. In 2019 the figures dipped by two percent to $23.8 billion while in 2020, a double-digit drop of 27.7 percent was recorded as diaspora remittances fell to $17.2 billion driven by the COVID-19 pandemic on the incomes of Nigerians living abroad.

Nigeria cannot afford to get it wrong this time as many things are riding on it. Remittance remains one of the major sources of foreign exchange for Nigeria

Worried by the decline the CBN introduced a raft of policies to boost remittances. One of the policies allowed beneficiaries of diaspora remittance to be paid in foreign currency. The apex bank also announced the Naira4dollar scheme in the second quarter of 2021 which pays diaspora Nigerians N5 rebate for every $1 or remittance sent through licenced International Monetary Transfer Operators (IMTOs).

But these interventions have yet to produce the type of results that will make a dent in the economy. The eNaira however is seen as the solution to addressing the lull in remittance. The CBN stated as much in a new regulatory guideline as it described the digital as complimenting the traditional Naira as a less costly, more efficient, generally acceptable, safe, and trusted means of payment. The apex bank must therefore ensure that there is no distraction to make this happen.