The eNaira can now be used for remittances — CBN

The move is aimed at driving adoption and providing an alternative for Nigerians to receive remittances.

The eNaira can now be used for remittances — CBN
Photo credit: asset from Freepik | Design by Ifeoluwa Awowoye

The Central Bank of Nigeria (CBN) has announced that individuals residing outside Nigeria can now send money into the country using its central bank digital currency (CBDC) — the eNaira. 

The details 

  • In a circular dated June 15, the bank noted that the move is aimed at driving adoption for the digital currency and providing an easy alternative for Nigerians to receive remittances.
  • The sender initiates a transaction by choosing a preferred International Money Transfer Operator (IMTO) to send the money through. They then provide the IMTO with the foreign currency payment and the eNaira wallet address of the beneficiary.
  • After receiving the payment from the sender, IMTO proceeds to deposit the equivalent amount of eNaira into the beneficiary's eNaira wallet.
  • This can be done either through the eNaira web wallet portal or by integrating with the eNaira's portal using the API provided by the CBN. 
  • The bank added that all foreign currency to naira conversions would be at the Investors and Exporters (I&E) FX window rate. 

Zoom in 

  • There have been calls for the CBN to make the eNaira a possible option for cross-border remittance payments. Recently, the vice chancellor of the University of Ilorin — a university in northcentral Nigeria — urged the apex bank to make the eNaira accessible to Nigerians in diaspora. 
  • Remittances to Sub-Saharan Africa grew by 5.2% in 2022, a development attributed to strong inflows to Nigeria and Kenya. 
  • However, these remittances require a huge fee. In what is the most expensive worldwide, it cost an 8.01% fee to send money across borders in Africa last year. 
  • It is unknown how much fees would be charged for each cross-border transaction settled with the eNaira. 

Zoom out 

  • The eNaira witnessed a slow adoption after it launched in 2021.  
  • However, that has seen an increase in more recent times. Per a Mariblock report, the CBN said that eNaira transaction volume rose by 63% between January and March. Additionally, of the 10 billion eNaira minted, 3.4 billion were already in circulation and 13 million new wallets were created between October and March. 
  • This increase was attributed to the Nigerian government’s social welfare program. 

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