A lack of trust in the Nigerian government an obstacle to the chances of success of CBDC - FinTech
A lack of trust in the Nigerian government an obstacle to the chances of success of CBDC - FinTech
While Nigerian apparently accepted the digital currency of the central bank of Nigeria (CBN), skeptical analysts believe that a lack of confidence in the government will ultimately restrict the success of E-Naira.
threat from fintech startups
In addition, some analysts insist that the already weak position of the digital currency is worsened by the fact that it has to compete with fintech startups. As before from Bitcoin.com News HEIMATET nigeria some of the biggest fintech startups and is a country that receives a relatively large part of the fintech investment of the continent.
According to a Financial Times test report E-naira opportunities to fulfill some of the goals of the CBN, such as bringing more people into the financial system or enabling more targeted social and social expenditure.
One of the analysts cited in the report who expresses doubts about the chances of success of E-Naira is Adedayo Ademuwagun, an analyst at Songhai Advisory. According to Ademuwagun, most of the destinations that the CBN wants to achieve with the digital version of the Naira are already approached by private fintech startups. He explained:
The problem is that all of this can already be adequately addressed with the existing financial payment system. Nigeria is the Fintech capital of Africa, so there are so many ways to pay so many ways to pay someone, already.
trust problems
Another analyst, Ronak Gadhia from EFG Hermes, believes that the belief that the government will monitor all e-naira transactions could be sufficient to prevent some of using e-naira.
"The government effectively knows every transaction that you carry out [with a digital currency] and in a place like Nigeria, where there is a little distrust between normal Nigerians and the government, there can be skepticism in relation to adoption", Gadhia is cited in the report.
In order to underpin his argument, Gadhia points out how the Nigerian government could simply suffocate the End-Sars protests freezing the bank accounts of people who had organized the protests.
Despite his doubts about the prospects of the E-Naira, Gadhia insists that it is too early to assess or reject the potential of the digital currency.
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