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What Is CBN’s ‘Naira 4 Dollar’ Scheme All About? Why Are They Introducing It?



As the naira continues to struggle against the dollar and Nigeria’s economy continues to experience significant challenges, the Central Bank of Nigeria (CBN) is relentlessly trying to increase the inflow of diaspora remittances into the country, considering that it strengthens the economy and may influence the stabilization of the exchange rate of the naira.

Just three months after the CBN announced that diaspora remittances would no longer be received in naira, the apex bank has now introduced a new “Naira 4 Dollar scheme.” In line with the new scheme, anyone who receives diaspora remittances through CBN-licensed IMTOs will be paid the sum of N5 for every $1 that is received as remittance inflow. The new policy is set to take effect for three months, from Monday, 8th of March, 2021, to Saturday, 8th of May, 2021.

According to a forecast by PwC, Nigeria’s remittance inflow could grow to $34.89 billion by 2023. The new CBN policy is one of the efforts of the CBN to attract diaspora remittances, and possibly meet or exceed this projection, in order to stabilize the naira and boost the nation’s economy, just like crude oil export does for the nation. The policy is also aimed at encouraging Nigerians in diaspora to remit funds through CBN-approved channels, thereby, restricting the “promo” to only funds that are received through approved IMTOs. This is coming just a few weeks after the CBN banned the operation of crypto exchanges who would have been cheaper and faster alternatives for cross-border remittances.

The Naira 4 Dollar scheme, however, is not the first of its kind to be implemented by nations across the globe. In 2019 and 2020, respectively, Bangladesh and Pakistan introduced incentives to attract diaspora remittances. Pakistan’s incentive schemes boosted the country’s remittance inflow from $20 billion in 2018 to $28 billion in 2020, a 40% increase despite the Covid-19 pandemic in 2020. Bangladesh also experienced a similar boost in its remittance inflow, with a 45.03% increase from $15 billion in 2019 to $21.9 billion in 2020.

This new strategy is largely hinged on the assumption that it would attract a higher influx of diaspora remittances because people would want to enjoy the monetary benefits that come with it, which would incentivize them to send more funds to the country. However, it is important to examine whether a N5 bonus for every $1 that is remitted is actually sufficient to incentivize more people to send funds from outside the country. Currently, bank and wire transfers, which are the most common ways of sending money to Nigeria, are relatively expensive and slow. The high rates and time taken to send money through official channels make it extremely stressful and expensive for Nigerians to utilize these channels to send funds. Also, the Covid-19 pandemic has significantly affected the financial situation of many Nigerians living abroad, thereby, limiting the ability of Nigerians in diaspora to send funds to the country. Therefore, it is not really certain if a N5 rebate would be able to attract Nigerians to take advantage of this short-term opportunity to send more money home and do so using the same CBN-licensed channels which are majorly cumbersome alternatives.

While some members of the public expressed optimism towards the introduction of the new policy, others believe it is not the way forward. With Nigeria’s excessive dependence on oil to boost foreign exchange reserves and strengthen the economy, a lot of people believe that diversifying the economy by increasing the export of non-oil products is actually a more sustainable and efficient way to strengthen the economy than this new scheme.


Kehinde is a driven human who is passionate about leveraging technology to transform the future of humanity and the way we all live. His interest lies in constantly getting valuable information and being part of a mission that seeks to create a transformative radical shift.

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Nigeria’s Central Bank Digital Currency e-Naira Gain Traction




According to Governor Godwin Emefiele, the Central Bank of Nigeria’s (CBN) digital currency, the eNaira, which was officially revealed on Monday, has garnered immense interest and a positive response from both within and beyond Nigeria, with 33 banks fully integrated on the platform. The CBN has successfully minted $500 million, with N200 million going to financial institutions, according to Emefiele, who spoke at President Buhari’s historic launch in Abuja.

In addition, over 2,000 clients have been added to the eNaira platform, and over 120 merchants have successfully enrolled. Since its launch, the eNaira website has had approximately 2.5 million daily views. Customers who download the eNaira Speed Wallet App will be able to complete the onboarding process and build their wallet, locate their eNaira wallet from their bank account, transfer eNaira from one wallet to another, and make payments at registered merchant locations.

In terms of maintaining a robust payment system, the Central Bank of Nigeria (CBN) feels that the eNaira will make a big difference to Nigeria and Nigerians. The eNaira will also lower the cost of processing currency, allowing for more direct and transparent welfare interventions for citizens, as well as increased revenue and tax collection, easier diaspora remittances, lower the cost of financial transactions, and improved payment efficiency.

Governor Godwin Emefiele outlined these advantages during the historic debut in Abuja, saying that Nigeria’s Central Bank Digital Currency (CBDC) is the first in Africa and a digital version of the actual Naira. 

What is eNaira?

The eNaira is the same Naira with considerably more possibilities, Emefiele asserted emphatically, guaranteeing that the new payment system is one of the most robust in the world, sufficiently safeguarded, and thus nothing to worry about.

In 2017, the Central Bank of Nigeria (CBN) began an intensive study, consultations, identification of use cases, and testing of the CBDC idea in a Sandbox environment, in response to increased interest in Central Bank Digital Currency (CBDC) around the world.

The goal of the study was to provide a strong argument for the introduction of a digital currency in Nigeria so that all Nigerians can benefit from a more successful and inclusive economy.

Following the completion of preliminary research, the CBN’s researchers and experts were able to clearly establish that a digital currency will promote a more paperless, inclusive, and digital economy, complementing the successes of prior policy initiatives and our rapidly increasing payment systems.

As a result, the CBN decided to create its own CBDC, dubbed the eNaira. Like the physical Naira – eNaira is a legal tender in Nigeria and a liability of the CBN, which will have the same value and always be exchanged at 1 naira to 1 eNaira

To reduce the risk of the process, the CBN has carefully considered the entire payments and financial architecture, and has structured the eNaira to complement and improve these ecosystems, as well as implementing security protections and policies to ensure the financial system’s integrity.

To maintain the integrity and stability of Nigeria’s payment system, strict adherence to anti-money laundering and counter-terrorist financing regulations would be enforced, according to Emefiele.

The eNaira, like other digital revolutions, is a journey, and Nigerians should expect more features in the coming months. Accessibility and onboarding of consumers without BVN, as well as the usage of the eNaria on the phone without access to the internet, are among them. 

Nigeria will be one of the first countries in the world to implement the CBDC using USSD on phones, bypassing the need for internet access. The CBN also plans to use the eNaira platform to onboard revenue collection agencies in order to increase and simplify collections, as well as to create sector-specific tokens to support the Federal Government’s social programs and distribution of targeted welfare schemes in order to lift millions of people out of poverty by 2025.

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Market Watch

Jack Dorsey‘s Square to develop open source Bitcoin mining



Jack Dorsey Bitcoin

On Friday, October 15, Twitter CEO Jack Dorsey announced that American fintech company, Square, would be looking to get into Bitcoin mining. Jack Dorsey who is also Square’s CEO announced this on Twitter which subsequently sent waves through the bitcoin market, surging its price to almost a record high, rising over $62,000 over the weekend. According to the Twitter boss, Square is looking to building an open source Bitcoin mining system that would be available to individuals and businesses.

Sharing his thoughts further on the initiative, he stated that “Mining needs to be more distributed” and that “the more decentralized [mining] is, the more resilient the Bitcoin network becomes. He also mentioned the apparent inaccessibility of mining stating that “Bitcoin mining should be as easy as plugging a rig into a power source.

Dorsey also believes that bitcoin mining “needs to be more efficient and that “clean and efficient energy use” would be undoubtedly beneficial to the digital currency in the long run.

Dorsey ended the thread by saying that a “technical investigation would be undertaken by a Square team led by Jesse Dorogusker, Square’s hardware lead. If successful, this initiative would be another of Square’s bitcoin focused projects which includes a Bitcoin hardware wallet.


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Financial Leaders from G7 Release Guidelines for Central Bank Digital Currency



Source: World Atlas

At a meeting that was held in Washington, yesterday, October 13, G7 leaders discussed central bank digital currency and endorsed 13 public policy principles with regards to their implementation. The financial leaders from G7 agreed that CBDCs would complement cash and should not be detrimental to the monetary system. The G7 leaders have been discussing CBDCs this week concluding that they should do no harm and meet rigorous standards.

It should be noted that G7 includes finance leaders in advanced economic nations comprising of Canada, France, Germany, Italy, Japan, the U.S and the U.K. the G7 leaders make it mandatory that any newly launched CBDC should not harm the central bank’s ability to perform its duty of maintaining financial stability. In a joint statement by the G7 finance ministers and central bankers, they said that, 

“Strong international coordination and cooperation on these issues help to ensure that public and private sector innovation will deliver domestic and cross-border benefits while being safe for users and the wider financial system.” 

The joint statement further states that CBDCs are complements to cash and could serve as a liquid or safe settlement assets with an added advantage of anchoring existing payment systems. CBDCs issuance should be entrenched in a long-standing public commitment to transparency, rule of law, and sound economic governance. The statement added at CBDCs must be so efficient that they are fully interoperable on a cross-border basis. 

The G7 leaders agreed that they had a duty to minimize the incidence of ‘harmful spillovers to the international monetary and financial system” 

The G7 statement reiterated a similar statement earlier made by G20 that no global stablecoin project should begin operation until such a token has addressed legal, regulatory and oversight requirements. 

Countries like China and Nigeria are ahead of the pack with regards to the adoption of digital Yuan and Naira respectively. China’s crackdown on cryptocurrency may be a step forward for the country’s plan to promote its digital Yuan. Nigeria, on the other hand, postponed the launch of its eNaira in deference to the 61st anniversary of Nigerian independence on Oct 1. 

However, countries like the US and the UK are dragging their foot with regards to the introduction of CBDCs to their financial system. There are insinuations that America is in danger of being left behind technologically and financially if it doesn’t get serious with the implementation of CBDC in its financial system.

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