E-Naira grew by 284%, as the notes decline to N2.7tn – CBN
NIGERIA, Dec. 29 – The Central Bank of Nigeria (CBN) revealed that the volume of e-Naira in circulation grew by 284.6 % to N9.78bn in August.
This development was as a result of the decline in the volume of notes and coins by 14 % to N2.65tn in August 2023. The apex bank made this known in its recently published ‘Economic Report’ for the month of August 2023.
The Bankers Bank stated that the volume of e-Naira in circulation is still insignificant relative to the volume of notes and coins in circulation. It said, “There was a substantial increase in the eNaira, which rose by 284.6 % to N9.78bn, although the ratio of e-Naira to CIC at 0.37 % remained insignificant, compared with notes and coins which accounted for 99.63 %.”
The Apex Bank while commenting on currency in circulation, noted that this dropped by 11.7 % to N2.66tn in the month. It noted, “Currency-in-Circulation, however, declined by 11.7 % to N2.66tn, which moderated the growth in the reserve money.
“There was a substantial increase in the e-Naira, which rose by 284.6% to N9.78bn, although the ratio of eNaira to CIC at 0.37 % remained insignificant, compared with notes and coins which accounted for 99.63 %. The volume of notes and coins, however, declined by 14.0 % to N2.65tn at end-August 2023.”
The report stressed that this reduction was as a result of increased in the use of alternative channels of payment, as more people adopted electronic transfer payments and other electronic platforms.
Since the launch of the e-Naira by the CBN in 2021, there have been questions about its adoption. According to the International Monetary Fund (IMF), about 98.5 % of e-Naira wallets have remained unused one year after the launch of the digital currency.
In a report titled, ‘Nigeria’s e-Naira, One Year After,’ the IMF revealed that adoption of e-Naira by households and merchants has been slow and low.
It said, “The retail wallet downloads saw a few weeks of initial surge before tapering off. More specially, it only took 25 days for the number of downloaded wallets to reach 500,000 units—but going from there to 600,000 units took another 63 days; and to 700,000 units yet another 143 days.
“As of end-November 2021, the total number of retails eNaira wallets amounted to about 860,000. This is just 0.8 per cent of Nigeria’s active bank accounts. Merchant wallet download has reached about 100,000 in end-June, which is about one eleventh of the number of merchants with Point-of-Sales (POS) terminals—which enables credit or debit card payments.”
The Nigeria e-Naira may likely speed up in the coming year as the CBN has not made any effort to increase the volume of notes and coins in circulation.
