JEFMS Journal

ABSTRACT:

The Central Bank of Nigeria has recently initiated idea to digitalize the Nigerian currency (Naira) making it possible to be stored in a wallet. The launch of the eNaira has been seen as an avenue to change the narrative of doing business globally without encumbrances. Based on this, the study examined the evolution of eNaira for re-engineering the Nigerian emerging economy. The study specifically sought how eNaira re-engineer’s financial inclusion, direct and transparent welfare intervention, and revenue base in the Nigerian emerging economy. The study adopted a descriptive survey research design with a census of 36 as the sample size. The statistical tool employed for the analysis was the ANOVA. The mean and standard deviation were applied to answer three research questions that guided the study. A probability value of 0.05 significant level was used to test three stated hypotheses. The results revealed that eNaira positively and significantly re-engineer’s financial inclusion and the revenue base in the Nigerian emerging economy. However, it did not support direct and transparent welfare intervention for the citizens. The study further observed that irregular internet network, shortage of electronic devices, increase in financial cost, and activities of hackers may likely hinder this lofty idea. Based on this, the study recommended that the Central Bank of Nigeria should provide a sound financial platform and user-friendly infrastructures that will capture data of all citizens and those operating businesses in/with Nigeria. Finally, the Nigerian Communication Commission and the network providers should endeavor to provide uninterrupted internet networks to consumers.

KEYWORDS:

Anova, Emerging economy, eNaira, Financial inclusion, Nigeria
JEL Classification Code: C12, C83, D6, F24, F68, H26.

REFERENCES:

1) Bordo, M. D. (2021). Central Bank Digital Currency in historical perspective: Another crossroad in monetary history. NBER Working Paper No. 29171

2) Dupuis, D., K. Gleason, and Z. Wang (2021). Money laundering in a cbdc world: a game of cats and mice. Journal of Financial Crime.

3) Femi-Lawal, F. (December, 2021). Market implications of Nigeria’s digital currency. Forbes. https://www.forbes.com/sites/forbesbusinessdevelopmentcouncil/2021/12/22/Market-implications-of-nigerias-digital-currency/?sh=5c0ab55a52ac

4) Koziuk, V. (2021). Confidence in digital money: Are central banks more trusted than age is matter? Investment Management and Financial Innovations 18(1), 12–32.

5) Chukwuere, E. J. (2021). The eNaira – opportunities and challenges. Journal of Emerging Technologies, 1(1); 72-77.

6) Ekong, M. U. & Ekong, N. C. (2022). Digital currency and financial inclusion in Nigeria: lessons for development. Journal of Internet and Digital Economy, 2(1); 46-67.

7) Obiora, F., Omaliko, E. & Okeke, C. J. (2022). E-Naira digital currency and financial performance of listed deposit money banks in Nigeria. International Journal of Trend in Scientific Research and Development, 6(2); 222-229.

8) Official Monetary and Financial Institutions Forum (OMFIF) May, 2022). Innovations and evolution in payments and role of central banks. Omfif.org

9) Penetta, F. (February, 2022). Central bank digital currencies: defining the problems, designing the solutions. European Central Bank. https://www.ecb.europa.eu/press/key/date/2022/html/ecb.sp220218_1-938e881b13.en.html.

10) Mancini-Griffoli, T., Peria, M. S. M., Agur, I., Ari, A., Kiff, J., Popescu, A & Rochon, C. (2018) Casting Light on Central Bank Digital Currency. IMF staff discussion note 8 (18), 1-39.

11) Muller, J. & Kerenyi, A. (2022). The rise of central bank digital currencies. Financial and Economic Review, 21(3), 122-148.

12) Ree, J. (November 2021) Five Observations on Nigeria’s Central Bank Digital Currency. IMF country focus. https://www.imf.org/en/News/Articles/2021/11/15/na111621-five-observations-on-nigerias-central-bank-digital-currency

13) Sanusi, K. Y. (May, 2022). How has Nigeria’s digital currency fared since its launch? Aljazeera. www.aljazeera.com/features/2022/5/23/how-has-nigeria’s-digital-currency-fared-since-its-introduction.

14) Tronnier, F., Recker, M. & Hamm, P. (2020). Towards central bank digital currency - a systematic literature review.

15) Tronnier, F. (2021). Privacy in payment in the age of central bank digital currency. IFIP Advances in Information and Communication Technology 619 IFIP, 96–114.

16) Yao, Q. (2018). A systematic framework to understand central bank digital currency. Science China Information Sciences, 61(3), 1–8.

17) Zimwara, T. (April, 2022). Study finds 33.4 million Nigerian adults hold or have traded crypto in last 6 months. News.bitcoin.com