CBDC Project With NFC Technology
Despite the former governor’s ousting nearly two months ago, the Central Bank of Nigeria (CBN) is still committed to its central bank digital currency (CBDC) project, showing no signs of abandoning it. To improve the CBDC mobile app, the central bank has incorporated Near Field Communication (NFC) technology, which allows mobile devices and payment terminals to interact when in close proximity, thus facilitating convenient and contactless eNaira payments.
The CBN emphasizes that the addition of NFC technology will play a crucial role in increasing the adoption rates of the CBDC. Joseph Angaye, the deputy director of the CBN’s risk management department, has stated that the banking regulator is committed to utilizing innovative technology to enhance user experience.
Angaye has also revealed that the CBDC will be equipped with programmability features, such as the ability to limit CBDC payments exclusively to designated government programs, reducing the risk of fraud. With the introduction of web 3.0 technology, the CBDC project is now set to provide users with a more secure and efficient payment experience.
Exploring CBDCs in Nigeria
In further explanation, Angaye reportedly highlighted the advantages of CBDCs, such as programmability for targeted fund allocation and mitigating settlement risks. The eNaira wallet, launched in 2021, is designed to address the issue of financial inclusion and provide valuable insights for other economic players. Despite this, adoption rates have been lower than expected, and former CBN Governor Godwin Emefiele blamed commercial banks for stifling eNaira’s growth.
To drive usage, the central bank has rolled out use cases in the transport sectors and included USSD functionality in the offering. Additionally, Nigeria is part of a select group of countries utilizing Web 3.0 technology, and those looking to learn more about this space can benefit from the country’s experience.
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