After Kicking Binance Out of Nigeria, CBN Partners with Blockchain Firm to Increase eNaira Usage

• The Central Bank of Nigeria is collaborating with a blockchain firm to boost eNaira adoption across Nigeria
• The bank signed a Memorandum of Understanding with Gluwa, a blockchain technology firm boost the performance of the digital currency
• The firm said the move is to strengthen eNaira’s functionalities and acceptance across Nigeria following low adoption

Legit.ng journalists Dave Ibemere and Pascal Oparada have over a decade of experience covering business and the economy.

The Central Bank of Nigeria has signed a Memorandum of Understanding with Gluwa, a blockchain company, to drive the adoption of the eNaira.

Stakeholders had asked the CBN in October last year to seek collaboration with financial technology companies to help in the adoption of Nigeria’s digital currency.

The partnership between CBN and Gluwa comes just days after the world’s largest cryptocurrency exchange platform, Binance, announced that it was halting operations in Nigeria, following a clampdown on crypto platforms.

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Binance also turned off its peer-to-peer naira feature on the platform, citing regulatory concerns.

CBN, Gluwa plan for eNaira

Speaking on the partnership, Gluwa said the new collaboration will leverage blockchain technology.

TheCable reports that the company said the collaboration seeks to improve eNaira’s technical functionalities, driving wider adoption and enhancing financial inclusion across Nigeria.

Gluwa said:

“We are thrilled to share monumental news! After years of relentless effort, Gluwa has signed a Memorandum of Understanding (MoU) with the Central Bank of Nigeria (CBN) to officially onboard as a Partner Agent and help drive the increased adoption of Nigeria’s CBDC, also known as eNaira.”

Benefits of CBN, Gluwa's partnership

Gluwa stated part of the collaboration is the credal integration with eNaira to allow for more accessible loan originating, tracking, settlement, and credit scoring for local fintech lenders, Punch reports.

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It added that the main aim is to take advantage of the power of blockchain technology to boost financial inclusion, improve the eNaira functionalities and drive financial innovation.

“The first step towards deepened collaboration is integrating Gluwa’s Credal blockchain innovation directly with Nigeria’s CBDC (eNaira).

“Gluwa is aiming to onboard millions of Nigerians and help them build secure, on-chain credit reputations as a valuable new mechanism to drive CBDC adoption, the company stated.

eNaira history in Nigeria

Since its launch on October 25, 2021, under former governor Godwin Emefiele, eNaira has suffered from low usage by Nigerians, and many still need to learn its use and importance. The few who signed up rarely use it.

The International Monetary Fund (IMF) stated in May 2023 that about 98.5% of eNaira wallets have yet to be used even once.

According to the IMF, the digital currency has remained stagnant beyond the initial wave towards widespread adoption.

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FG asked to use e-Naira for transfer

Earlier, Legit.ng reported that the CBN pitched the e-Naira to the federal government as the best alternative for sharing $800 million, about N368.8 billion, in its National Social Safety Net Programme Scale Up.

The pitch by the CBN was an effort to drive and strengthen its cashless policy. It was contained in CBN's National Fintech Strategy document.

Source: Legit.ng