Nigeria rolls out Africa’s first digital currency

ABUJA, Nigeria

Nigeria is officially launching a new digital version of its currency, the eNaira, after postponing the operation initially planned for early October, Nigerian President Muhammadu Buhari announced Monday.

With this launch, Nigeria, Africa’s largest economy in terms of GDP and the continent’s most populous country (over 200 million inhabitants), is a pioneer on the continent, alongside Ghana, which has been testing its e-Cedi as a new means of exchange since September.

“We have become the first country in Africa and one of the first in the world to have introduced a digital currency for our citizens,” said Buhari.

The president said the new digital currency would improve cross-border trade, financial inclusion for people outside the formal economy and increase remittances.

Originally scheduled for October 1, the launch of the eNaira had been delayed by the Central Bank, citing the country’s independence anniversary celebrations.

Crypto-currencies are widely used in Nigeria, ranked in 2020 as the third largest user of virtual currencies in the world after the United States and Russia, by a study from specialist research firm Statista.

With cryptocurrencies, Nigerians are mainly looking to escape the constant depreciation of the naira in recent years. They also make it easier for them to receive money from the diaspora or move their savings out of the country.

Central banks around the world are looking to create digital versions of their currencies, known as CBDCs, in response to the growth of online payments and to compete with cryptocurrencies that are beyond the control of governments and global regulators.

Last year, China became the first major economy to launch a test version of a digital currency. Since then, at least five countries have launched their virtual currencies.