Last week, the International Monetary Fund (IMF) published a report assessing the progress of Nigeria’s central bank digital currency (CBDC) after its introduction in October 2021. The paper notes the eNaira’s slow adoption and takes stock of the Central Bank of Nigeria’s efforts to encourage its usage, including for cross-border remittances. It recommends promoting the use of the CBDC for government aid programs, boosting merchant adoption, and offering attractive eNaira FX rates to discourage unofficial remittance routes.
More than one year after its launch, Nigeria’s CBDC adoption remains “disappointingly low,” according to the IMF. Wallet downloads saw some initial success, reaching 500,000 units in the first 25 days, but quickly slowed down as time passed, reaching 860,000 by November 2022. Adoption has been particularly slow among merchants, but retail customers have generally failed to sign up, with the total number of onboarded clients struggling to reach 1% of active bank accounts.
Similarly, both the number and value of CBDC transactions have been somewhat limited. The eNaira has seen a recent surge amid cash shortages, but the vast majority (98.5%) of wallets remain unused on any given week, suggesting very little regular use. Additionally, the paper notes that “the total number of eNaira transactions since the inception (around 802,000) is less than the number of eNaira wallets—implying that bulk of the current wallet holders have not used their wallets more than once after opening.”
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