E-Naira Will Have Far-Reaching Implications For Banking Sector – Economists

E-Naira Will Have Far-Reaching Implications For Banking Sector – Economists

Economists have said that the e-Naira, when rolled out, will have far-reaching implications for the future of the banking sector in Nigeria.

The experts, in separate interviews with the newsmen, said whether the launch would be salutary or destabilizing would depend on how it is implemented.

President Muhammadu Buhari, on Monday launched the Central Bank Digital currency, the e-Naira.

With the official launch, Nigeria becomes the first country in Africa and one of the first in the world to introduce a digital currency to its citizens.

Uche Uwaleke, Professor of Finance and Capital market, Nasarawa State University, Keffi, said without doubt that the launch would have effects on the future of the banking sector.

“Expectedly, being among first-time movers of a technologically-complex project such as a central bank digital currency, it is bound to create winners and losers and produce unintended consequences.

“The cheering news, however, is that the CBN appears to have devoted considerable time and resources to prevent undesirable outcomes especially in relation to the health of the Nigerian banking sector.

“In any case, that the CBN is testing e-Naira through pilot projects is a demonstration of a cautious approach. All said, the launch of the CBN’s digital currency is an important milestone which holds a lot of promise for the financial system in Nigeria and the banking sector in particular,’’ he said.

The Director, Centre for Economic Policy Analysis and Research (CEPAR), Prof. Ndubisi Nwokoma, said that the currency which is novel, would be faced with distrust even as implementation progresses.

“The launch of the e-Naira is a new path being taken by the CBN to follow in the global practice of enhancing the payment system through the use of digital currency.

“It is novel, even in advanced societies hiccups may be encountered as implementation progresses. Even currently, many global companies have not fully embraced the use of crypto-currencies in payments.

“Skepticism may be the order of the day, at the onset, except for those already familiar with digital currencies,’’ he said.

Sheriffdeen Tella, a Professor of Economics at the Olabisi Onabanjo University, Ago-Iwoye, Ogun State, said the e-Naira is a worthy innovation by the CBN, hoping that the banks would keep the charges low so as not to frustrate the project.

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