"eNaira Circulation Surges by 302% in Nine Months, Reflecting Rapid Adoption of Nigeria's Central Bank Digital Currency"

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"eNaira Circulation Surges by 302% in Nine Months, Reflecting Rapid Adoption of Nigeria's Central Bank Digital Currency"

The value of eNaira in circulation has experienced an exponential growth, soaring by 302% within a span of nine months, reaching a total of N10.26 billion by the end of September. This surge signifies a substantial increase in the adoption of Africa's Central Bank Digital Currency (CBDC). The rise in eNaira circulation, as reported by Babajide Komolafe, Economy Editor at Vanguard, is attributed to the burgeoning transactions conducted through USSD channels.

Launched by the Central Bank of Nigeria (CBN) in October 2021, eNaira represents the digital incarnation of Nigeria's official currency, the Naira, functioning akin to traditional paper money. Individuals utilize the eNaira wallet as a digital repository for storing, accessing, and utilizing their eNaira holdings.

Analyzing data sourced from the CBN's quarterly statistical bulletin for the third quarter of 2023, Vanguard's analysis reveals a staggering surge in the value of eNaira in circulation, leaping by 302% from N2.55 billion at the end of 2022 to N10.26 billion by September 30th, 2023. This increase marks a substantial advancement, surpassing the 171% growth recorded during the same period in the previous year.

Quarter-on-quarter examination further illustrates the robust growth trajectory of eNaira circulation, with Q1’23, Q2’23, and Q3’23 witnessing respective growth rates of 90%, 48%, and 43%.

The accelerated adoption of eNaira is underpinned by proactive measures implemented by the CBN to stimulate usage among the banking populace. These initiatives include the introduction of Enhanced USSD service channels, tailored to cater to feature phone users, enabling Nigerians to effortlessly open eNaira wallets and conduct transactions by dialing *997 from their mobile phones. Additionally, in June, the CBN introduced eNaira as a payout option for recipients of Diaspora remittances, further expanding its utility.

Sources closely associated with the apex bank affirm that the upsurge in eNaira adoption is predominantly driven by transactions conducted via USSD channels. Notably, the volume and value of eNaira transactions via USSD channels witnessed a robust year-on-year increase of 92.95% and 120.93% respectively during the nine-month period of 2023. Moreover, the number of merchants accepting eNaira payments rose by 11.97% within the same timeframe.

Although the utilization of eNaira as a payout option for Diaspora remittances remains in its pilot phase, its integration underscores the CBN's commitment to advancing financial inclusion and harnessing the potential of digital currencies in Nigeria's economic landscape.

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