eNaira: The Innovative Digital Currency For Nigerians
Amid the ongoing research and the increasing popularity of digital currency across the world, the Federal Government of Nigeria have decided to adopt and create a digital version of her currency, known as eNaira. Considering the relatively reduced knowledge about the digital currency and the reasons for its adoption, there has E been several questions raised since its implementation. Questions regarding what digital currency is, its functions, why it is being adopted, and the benefits which it possibly offer.
Digital currency have come into the spotlight in recent times through the increasing value of cryptocurrencies such as bitcoin and its adoption by major international companies such as PayPal, Square, Microsoft, Tesla, and so on. It has also been a raging subject of discussion among revered individuals like Elon Musk, Bill Gates, Jack Dorsey, and other billionaires.
In this article, we will provide answers to the numerous questions plaguing Nigerians about the eNaira, Cryptocurrency, Digital currency, its functions and benefits, and why it is the future of finance around the world.
What is eNaira?
Over the years, the innovation and development of technology have seen the coming of age of different kinds of digital currencies, each of which have different utilities in different economic and financial sector today. Examples of digital currencies include Cryptocurrency, Virtual currency, and Central Bank Digital Currency (CBDC).
The most popular of these digital currencies are cryptocurrency. Over the years, Cryptocurrency has gained so much popularity through diverse use cases that it has gained the attention of different governments around the world. However, the relatively limited knowledge and few disadvantages of the concept has meant that its adoption as a legal tender is relatively slow. Regardless of the stumbling blocks which it experiences today, many are of the opinion that cryptocurrency is the future of finance, and its adoption by all governments on the planet is inevitable.
Cryptocurrency, under which the recently unveiled Nigeria digital currency is categorized, is deemed as the future of finance due to the numerous benefits that it has over traditional currency we use today. Like many other concepts in the human society that has been digitized to make life easier for many, Cryptocurrency will prove to be another concept brought about by technology.
The eNaira is simply a digital currency that is created to help Nigerians key into the current trend of cryptocurrency adoption that is slowly gaining steam in countries around the world.
Benefits of eNaira as a Digital Currency
As it is in the case of many other digital currencies available today, Nigeria digital currency offers a wide range of benefits. Most importantly, the solutions which a digital currency like eNaira offers is what makes it such a credible and an attractive means of exchange or legal tender. The benefits of the eNaira over traditional currency includes:
Digital currency transactions are irreversible once authorized. This offers exceptional protection against fraud compared to fiat currencies, which are less secure due to the personal information required to make transactions and the potential for chargebacks. Digital currencies are empowered by blockchain technology, making them virtually impossible to counterfeit or duplicate.
While transactions over the counter in traditional banking institutions are relatively fast, the stress of leaving your homes, transporting yourself down to the bank, being stuck in traffic, and joining a queue can increase the time required to complete a single transaction. eNaira eliminates all these problems in a single swipe. With eNaira, Nigerians can simply complete transactions wherever they are – whether at home, school, workplace, and so on.
Additionally, in cases where you need to transfer funds to international recipients, the Nigeria digital currency only takes a few seconds to help you complete international transactions. The reverse is the case in fiat currencies where international transactions may take more than a couple of days to complete. Digital currency payments, by contrast, are not only easy to make online via mobile devices but also functionally the same regardless of the amount or distance.
Because digital currency fees are peer-to-peer, you’ll encounter fewer, if any fees when transferring funds. The networking structure made possible by blockchain technology eliminates the need for intermediary institutions to facilitate transactions. Not only will you pay less in fees than you would if you were transferring fiat currencies, but you’ll also find it easy to monitor the process and keep track of your funds.
How to Create an eNaira Wallet
- Download the eNaira app through the Google Play store for Android users or the Apples app store for Apple devices.
- Launch the eNaira app after successful download.
- Input minimum identification details such as NIN, BVN, or KYC/AML Information, depending on the customer tier you are.
- Enter other identification details (i.e., Name, Place and Date of Birth, Phone Number, Passport Photograph, Email and Password).
- Provided details will be validated instantly.
- A mail is sent to the provided email address in order to activate your wallet.
- Proceed to Log in to account and use.
- Merchant should proceed to download the Nigeria digital currency Mobile App through the Google Play store for Android users or the Apples app store for Apple devices.
- Input invitation code from bank to validate it.
- Input the minimum identification details including Full KYC as stipulated in the CBN’s AML/CFT Regulations).
- Input your TIN (Tax Identification Number).
- TIN will be verified shortly
- Input other identification details including your email, password, Business Category, Legal Business Name).
- Your Financial Institution will verify your application.
- After verification, eNaira wallet can be created and activated through a mail addressed to provided email.
- Both the Merchant and respective Financial institution will then receive a notification of successful account creation.
Things you should Know About the eNaira
- The charges for transactions that originate from the eNaira platform shall be free for the first 90 days commencing from October 25, 2021.
- Electronic Funds Transfer below N5,000 is charged N10; N5,001 – N50,000 is charged N25 and for above N50,000, a N50 charge is associated.
- Phone numbers without verified National Identification Number (Tier 0) will have a daily transaction limit of N20,000, while the maximum that the account can hold is N120,000.
- For phone numbers with verified NIN or Tier 1, CBN said they have a daily transaction cap of N50,000 and a maximum balance of N300,000.
- Tier Two accounts will have access to a daily transaction of N200,000, while N500,000 is the maximum balance that can be held.
- The Tier 3 account holder can transact a maximum of N1m daily, while the Maximum balance it can hold is N5m.
- Merchant accounts have access to unlimited transactions. Merchants are duly accredited individuals and non-individual (corporates) authorized to conduct business in Nigeria.
- eNaira Merchant speed wallets shall be used solely for receiving and making eNaira payments for goods and services.
- Financial institutions were expected to maintain one treasury eNaira wallet to warehouse eNaira received from the CBN eNaira stock wallet.
- Financial Institutions (FI) may create eNaira sub-treasury wallets for branches tied to it and fund them from its single eNaira treasury wallet with the CBN and FI may create eNaira branch sub-wallets for its branches.
- To ensure security of funds, the eNaira has two-factor authentication and other measures.
REGULATORY GUIDE LINES ON THE Enaira
The provisions of these Guidelines shall apply to all financial institutions and users of the eNaira.
The eNaira Platform
This section gives an overview of the key components of the eNaira platform.
The Digital Currency Management System (DCMS)
The eNaira shall be administered by the CBN through the Digital Currency Management System (DCMS) to mint and issue eNaira. Financial institutions shall maintain a treasury eNaira wallet for holding and managing eNaira on the DCMS.
The Financial Institution Suite
The FI Suite is the primary application used by the FIs to manage their digital currency holdings, requests, and redemption with the CBN.
The eNaira Wallets
The eNaira platform shall host eNaira wallets for different stakeholders.
eNaira Stock Wallets
The eNaira stock wallet belongs solely to the CBN and it shall warehouse all minted eNaira.
eNaira Treasury Wallets
A financial institution (FI) shall maintain one treasury eNaira wallet to warehouse eNaira received from the CBN eNaira stock wallet. FIs may create eNaira sub-treasury wallets for branches tied to it and fund them from its single eNaira treasury wallet with the CBN.
eNaira Branch Wallets
An FI may create eNaira branch sub-wallets for its branches. The eNaira branch sub-wallet shall be funded from the treasury eNaira wallet.
eNaira Merchant Speed Wallets
eNaira Merchant speed wallets shall be used solely for receiving and making eNaira payments for goods and services.
eNaira Speed Wallets
eNaira speed wallets shall be available for end users to transact on the Nigeria digital currency platform.
Security and Privacy
The two-factor authentication and other measures shall be adopted to ensure the security of Nigeria digital currency wallet.
FIs shall integrate their backend systems to the DCMS for efficient transfer of eNaira between bank accounts and eNaira wallets.
AML/CFT checks for fraud prevention and detection shall apply on the Nigeria digital currency platform.
Participants and Roles
Central Bank of Nigeria (CBN)
The CBN shall exclusively perform the following roles:
- a) Mint, issue, distribute, redeem and destroy the eNaira;
- b) Determine the technical, regulatory and operational standards for the eNaira;
- c) Manage unresolved eNaira issues and complaints escalated from the FIs and
disputes arising between FIs;
- d) Monitor compliance with applicable regulations; and
- e) Issue directives and review Guidelines on eNaira periodically as may be required.
Financial Institutions (FIs)
The Financial Institutions are intermediaries between the CBN and customers. Their roles
within the eNaira ecosystem shall include:
- a) Facilitating eNaira speed wallet onboarding for bank customers (merchants and
individuals) including sensitizing them on the need to familiarize themselves with
details of their BVN particulars, especially email address. This is a major
requirement for the self-service enrollment process into the Nigeria digital currency Speed App.
- b) Integrating the eNaira speed wallet feature into their electronic banking channels;
- c) Requesting eNaira from CBN for self and on behalf of its customers;
- d) Managing eNaira across its branches;
- e) Developing and/or updating reports and internal frameworks to ensure compliance
with KYC and AML/CFT requirements;
- f) Receiving and resolving customers’ complaints on eNaira (including prompt
update of customers’ BVN particulars in NIBSS); and
- g) Ensuring that Nigeria digital currency enquiries and complaints are included in the periodic reports
Merchants’ roles include:
- a) Providing customers with alternative channels for making transactions using
- b) Providing cashback services for customers;
- c) Publicising the option of eNaira payment for transactions at merchant locations;
- d) Protecting their eNaira speed wallet credentials against fraudulent access.
Ministries, Departments and Agencies (MDAs)
- a) Receive revenue in eNaira; and
- b) Make payments in eNaira.
Consumers are the end users of the eNaira and their roles are specified below:
- a) Creating eNaira speed wallets and funding it;
- b) Utilising eNaira as an alternative payment option for legitimate transactions;
- c) Protecting their eNaira speed wallet access credentials; and
- d) Notifying financial institutions in the event of fraud/complaints/disputes.
Onboarding and Transactional Processes
This section describes the process of onboarding participants on the eNaira platform. The
onboarding process shall vary based on the role of each participant.
Financial Institutions (FIs)
The onboarding of FIs shall be done automatically by the CBN.
Merchants shall be onboarded by the FIs upon downloading the “eNaira Speed
Merchant App” from the app stores and fulfillment of the following requirements:
- a) Provision of all mandatory information;
- b) Acceptance of the Terms and Conditions of eNaira speed app;
- d) Validation and activation by their preferred FI.
MDAs shall be onboarded by the CBN upon receipt of the appropriate mandate.
Consumer onboarding shall be self-service upon downloading of the “eNaira Speed
App” from the app stores and fulfillment of the following requirements:
- a) Provision of all mandatory requirements;
- b) Acceptance of the Terms and Conditions of eNaira speed app; and
NOTE: For a successful self-service enrollment on the eNaira Speed App, the mandatory
requirements for some BVN details must match similar details attached to the consumer’s
profile at the BVN database. Consequently, there is need for consumers to familiarize
themselves with details of their BVN profile to identify and rectify gaps or stale information
(especially email address) through their banks. The relevant information for a successful
BVN validation check are:
- a) First Name;
- b) Last Name;
- c) Date of Birth (DD/MM/YYYY);
- d) State of Origin;
- e) Email; and
- f) Phone Number.
During the onboarding process, users shall have option to disclose whether the eNaira Speed wallet being created will be operated for self or as trustees.
The TIN, NIN and/or BVN shall be used as unique identifiers:
- a) TIN shall be for corporate entities;
- b) NIN and/or BVN shall be for individuals; and
- c) BVN shall be for merchants that are not corporate entities.
This section describes the various transaction types.
The following services shall be available to individual consumers on the eNaira platform:
- a) Person to Person (P2P);
- b) Person to Business (P2B) / Business to Person (B2P);
- c) Person to Government (P2G) / Government to Person (G2P);
- d) Cash or Bank account to eNaira speed wallet;
- e) eNaira speed wallet to cash or bank account; and
- f) Any other services as may be approved by the CBN from time to time.
The following services shall be available to merchants on the eNaira platform:
- a) Merchant/Business to bank account;
- b) Merchant/Business to Person (M/B2P); and
- c) Cash or bank account to eNaira speed wallet.
Merchants shall sweep their till balance(s) into their FIs accounts on a daily basis.
The following services shall be available to FIs on the eNaira platform;
- a) FIs to CBN / CBN to FI;
- b) FI to Government / Government to FI;
- c) FI to Business / Business to FI; and
- d) FI to Customer / Customer to FI.
Upon onboarding by the CBN, the following services shall be available to MDAs on the
- a) MDAs to Person / Person to MDAs;
- b) MDAs to MDAs;
- c) MDAs to FIs / FIs to MDAs;
- d) MDAs to CBN / CBN to MDAs; and
- e) MDAs to Businesses / Businesses to MDAs.
Charges and Cost Structure
The charges for transactions that originate from the eNaira platform shall be free for the
first 90 days commencing from October 25, 2021 and then revert to applicable charges
as outlined in the Guide to Charges by Banks, Other Financial and Non-bank
Financial Institutions are required to comply with the Money Laundering (Prohibition)
Act 2011 (as amended), the Terrorism (Prevention) Act 2011 (as amended) and all
subsisting anti-money laundering laws and regulations as may be issued by the CBN from time to time.
Users of Nigeria digital currency shall be subjected to a tiered structure with transaction and balance limits
Documentation requirements for Tier 0 users are:
- a) Passport Photograph;
- b) Personal Information (Name, Place & Date of Birth, Gender & Address); and
- c) Telephone Number (NIN issued but not linked to phone number).
Tier 1 – 3
Documentation requirements for Tiers 1 to 3 are as stipulated in CBN Circular on Tiered
Know Your Customer (T-KYC).
Merchants are expected to have existing bank accounts with FIs. Further requirements
at point of onboarding are:
- a) TIN;
- b) BVN of MD/CEO;
- c) Email address; and
- d) Business Category.
FI’s Compliance Officers at the Merchant’s bank shall carry out final verifications and
activation of their eNaira Merchant Speed Wallet.
Transaction and Balance Limits
The transaction and balance limits for individual and merchant eNaira wallets are shown
Category Daily Transaction Limit
(Phone number without
(Phone number with verified
Tier 2 N200,000.00 N500,000.00
Tier 3 N1,000,000.00 N5,000,000.00
Merchant No Limit No Limit
Financial Institutions shall put in place appropriate measures to ensure sound risk
management practices to address potential threats to their operations.
These shall include:
- a) An Enterprise risk management framework;
- b) Appropriate governance structures;
- c) Documented and approved policies; and
- d) Secured information technology infrastructure.
Financial Institutions shall be required to implement additional risk management measures as may be prescribed by CBN guidelines from time to time.
eNaira Speed Wallet Recovery Process
Roles and Responsibilities of the Stakeholders
The roles and responsibilities of the different stakeholders with respect to ensuring the
prevention or minimisation of loss following loss / theft of a user’s device or compromise
of user eNaira speed wallet are stipulated as follows:
Banks shall provide the following services:
- a) Ensure that eNaira users have access to an array of channels to report loss/theft of device or compromise of user eNaira speed wallet. At a minimum, banks shall
ensure that customers are able to report via:
- USSD channels;
- Internet banking platforms;
iii. Customer care phone lines; and
- In-branch customer care.
- b) Develop a system to validate the identity of complainants;
- c) Facilitate prompt placement of restriction on eNaira speed wallets where a valid
report of loss/theft of device or compromise of user eNaira speed wallet is made;
- d) Make reports to the CBN on number of reports received and actions taken thereon
eNaira Speed Wallet Users
eNaira speed wallet users shall have the following responsibilities:
- a) Ensure the protection of eNaira speed wallet login credentials and devices to
prevent disclosure to third parties; and
- b) Promptly report to Financial Institutions or eNaira Helpdesk where there has been
a loss/theft of device or compromise of user eNaira speed wallet.
eNaira Speed Wallet Recovery
This section outlines the process for eNaira speed wallet recovery.
Loss/Theft of Device
To recover eNaira speed wallets in the event of a loss/theft of device, users shall:
- a) Download a new “eNaira Speed Wallet App” from the app stores;
- b) Accept the Terms and Conditions of usage of the eNaira Speed Wallet;
- d) Input username and password.
- Contact FIs for assistance.
Compromise of eNaira Speed Wallet
In the event of a compromise of eNaira speed wallet, existing users shall:
- a) Request for a change of password using the Forgot Password functionality in
the Nigeria digital currency Speed App; and
- b) Input username and the new password.
- Contact FIs for assistance.
Financial and Regulatory Reporting
FIs shall render returns to the CBN in line with the provisions of the Banks and Other
Financial Institutions Act (BOFIA) 2020 and as may be specified from time to time.
Consumer Complaints in relation to the usage of the eNaira shall be referred to Helpdesk of users’ preferred FI Helpdesk. If unresolved by the FI Helpdesk, it shall be escalated to the eNaira Helpdesk via 0800myeNaira (0800 6936 2472) or email@example.com for resolution.
Complaints from Financial Institutions as well as disputes arising between Financial Institutions shall be reported to the eNaira Helpdesk Team and resolved within two (2)working days.
For disputes where one or both parties are unsatisfied with the resolution, the issue shall be referred to an arbitration panel as provided under the extant Arbitration and Conciliation Act or as may be defined by the Central Bank from time to time.
The effective date of these Guidelines is October 25, 2021.
The adoption of the Nigeria digital currency is quite a great idea and innovation from the federal government of Nigeria. Considering the benefits which it offers for general users of financial products, the adoption of eNaira comes at a perfect time to solve growing financial and economic issues in the country.
While the use of the Nigeria digital currency provides lots of benefits for users, there are lots of Nigerians who are still skeptical about the product. This is majorly as a result of the centralization and control by the giver, something that is quite the opposite of what digital currencies stand for. Digital currencies were created to provide autonomous control to users over their finances. The control and monitoring of the Federal government makes it a sticking point. It remains to be seen how this situation develops moving forward.