Nigeria in Talks with R3 to Develop eNaira

02/21/2023 13:30 • AI & Tech Insights • 120 views

On February 21, Nigeria was negotiating with potential technical partners to develop a new system to operate and manage its central bank’s digital currency, eNaira. A person familiar with the matter said that the Nigerian Central Bank had discussed the early stage plan with R3, a technology company headquartered in New York.

The Bank of Nigeria is seeking technical partners to develop a new system for managing CBDC

Interpretation of the news:

Nigeria, the largest economy in Africa, is in talks with R3, a New York-based technology company, to develop its central bank digital currency (CBDC), the eNaira. The talks come as the West African country moves closer towards launching the digital currency, which aims to offer a more efficient and cost-effective means of conducting transactions.

According to a person familiar with the matter, the Nigerian Central Bank has discussed the early-stage plan with R3, which has expertise in blockchain technology. The partnership would see R3 work closely with the central bank to develop a new system to operate and manage the eNaira.

The eNaira is expected to facilitate financial inclusion, reduce the cost of transactions, and increase efficiency for both individuals and businesses. It also aims to reduce the expenses associated with cash handling and management, as well as combating illicit financial flows.

Nigeria has been a keen observer of the global trend towards CBDCs and has been exploring the possibility of launching its own digital currency for some time. The move towards a CBDC comes as cash transactions remain the dominant means of conducting transactions in Nigeria, with a significant portion of the population unbanked.

The eNaira will be pegged to the Nigerian Naira and will aim to operate with the same level of trust and confidence as traditional fiat currency. The digital currency would also seek to address issues of corruption, particularly given Nigeria’s history of dealing with corruption scandals.

The partnership with R3 is a significant step towards the launch of the eNaira and the development of a new financial system for Nigeria. R3 has a wealth of experience in blockchain technology, having developed Corda, an open-source blockchain platform, which has been used by numerous global financial institutions.

In conclusion, the partnership between Nigeria and R3 to develop the eNaira is a significant move towards the adoption of CBDCs in Africa. The eNaira has the potential to revolutionize the financial sector in the country, especially in increasing financial inclusion and reducing the costs associated with cash handling. The partnership with R3 further underscores the importance of blockchain technology in the development of CBDCs and the financial sector as a whole.

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