TheCable

The Central Bank of Nigeria (CBN) says it has engaged Bitt Inc, a global fintech company, as the technical partner for its digital currency, eNaira.

Bitt is a Barbados-based fintech company that led the development of the Eastern Caribbean Currency Union’s “DCash” — the first digital cash issued by a currency union central bank.

Godwin Emefiele, CBN governor, disclosed the development in Abuja, on Monday.

Emefiele listed the benefits of the Central Bank Digital Currency (CBDC) to include increased cross-border trade, accelerated financial inclusion, cheaper, and faster remittances.

Others are easier targeted social interventions, as well as improvements in monetary policy effectiveness, payment systems efficiency, and tax collection.

Last month, the apex bank said it will launch the pilot scheme of eNaira by October 1, 2021.

Explaining the apex bank’s choice, Osita Nwanisobi, CBN’s spokesperson, in a statement, said the selection of Bitt Inc. from among highly competitive bidders was hinged on the company’s technological competence, efficiency, platform security, interoperability, and implementation experience.

“In choosing Bitt Inc, the CBN will rely on the company’s tested and proven digital currency experience, which is already in circulation in several Eastern Caribbean Countries,” the statement reads.

“Bitt Inc. was key to the development and successful launch of the central bank digital currency (CBDC) pilot of the Eastern Caribbean Central Bank (ECCB) in April 202I.”

Nwanisobi said following the CBN’s decision to digitise the naira in 2017, Project Giant, as the Nigerian CBDC pilot is known, has been a long and thorough process for the apex bank.

According to the spokesperson, the CBN’s decision follows an unmistakable global trend in which over 85 percent of central banks are now considering adopting digital currencies in their countries.

He attributed the global adoption of digital currencies to the significant explosion in digital payments and the rise in the digital economy.

Earlier this year, the CBN directed banks to close accounts of persons or entities involved in cryptocurrency transactions.

It warned that cryptocurrencies pose the risk of loss of investments, money laundering, terrorism financing, illicit fund flows and other criminal activities.

How is eNaira different from Bitcoin and other cryptocurrencies? To find out the answer to that and other questions you may have, read TheCable’s report here.