Emefiele boasts, “eNaira is a disadvantage for banks”

Central Bank Governor Godwin Emfiele has pointed out that eNaira is a disadvantage for commercial banks, especially when depositors transfer money from their bank accounts to their eNaira wallets.

Godwin Emefiele mentioned this during the Q&A session at the end of the Monetary Policy Statement on Tuesday, July 19, 2022, when asked to provide an update on the performance of Africa’s first digital currency. .

The remark was a seemingly noisy moment for the CBN Governor who took the opportunity to also outline several initiatives being taken to increase digital currency adoption.

Mr Emefiele admitted that eNaira had failed to live up to expectations and blamed this partly on lack of knowledge of the product among many Nigerians. He also mentioned that the CBN is planning to send its members to improve the promotion of eNaira.

What Emefiele said

Commenting on the low adoption of eNaira, he also took a swipe at commercial banks who might not want their customers to transfer money to their eNaira wallets as it would not be to their benefit.

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“I want to advise you, you can go to your bank, they may be a little reluctant to you because you transfer this money from your account to your wallet is a disadvantage for them and I want to say it boldly and bluntly. And again, it’s almost free at least today. You must therefore tell your bank that you want your eNaira to be loaded into your wallet. It will cost you little or nothing compared to those other products you have that will cost you more.

The remark is an apparent blow to banks and fintech which the governor now admits are in direct competition with eNaira. The CBN is clearly positioning eNaira as a cheap alternative for unbanked people to deposit their money and also use it as a cheaper means of payment transaction.

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“I will say quite frankly, I’m a banker myself, there’s apathy there because they know they’re going to lose revenue, so you should insist on using your wallet to do your transactions.”

Results

Efiele’s remark may not sit well with eNaira critics, especially those in the banking industry who spoke to Nairametrics anonymously about the digital currency.

  • Some fear CBN is pushing a product that is in direct competition with their own applications even if it is in the same vein as their regulator. The question of conflict of interest therefore arises.
  • However, CBN sources insist that it is to achieve the goal of financial inclusion, which is to serve the unbanked and reduce the cost of financial transactions.
  • Emefiele also mentioned that they are concluding with MTN to target the unbanked population through a USSD code *997## to transfer money to their wallet. This will give them wider access to the unbanked people the product is intended for.

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