By Chinwendu Obienyi
The Central Bank of Nigeria (CBN) has reported that total transaction volume of its digital currency, eNaira, for August 2023, reached N9.78 billion.
According to the apex bank’s monthly economic report for August 2023, this represents a 284.6 per cent increase.
Although the increase in eNaira for the month was substantial, when compared to the Currency-In-Circulation (CIC) it was only 0.37 per cent.
“There was a substantial increase in the eNaira, which rose by 284.6 per cent to N9.78 billion, although the ratio of eNaira to CIC at 0.37 per cent.”
The CBN also reported an 11.7 per cent decline in currency-in-circulation for August to reach N2.66 trillion. The decline in CIC, the CBN was attributed to a rise in the use of electronic payment methods for business transactions.
Furthermore, total credits for the month increased by 0.8 per cent to N38.55 trillion for the month with the service sector constituting over half of the credits at 52.2 per cent. The industry and agricultural sector represented 43.2 per cent and 4.6 per cent respectively.
On the other hand, consumer credits for the month stood at N2.99 trillion representing an increase of 16.9 per cent from the previous month when compared to the previous month. The report noted that the rise in consumer credit is caused by an increase in demand for credit facilities by economic agents.
Personal loans constituted the most consumer credit for the month at 75.4 per cent trailed by retail sector loans which represented 24.6 per cent. The CBN had launched the eNaira in 2021 as part of its efforts to promote financial inclusion, innovation, and efficiency in the Nigerian economy. Although the innovation had noble intentions, adoption has been very low. A report by the International Monetary Fund (IMF) 2023 assessed the adoption of the eNaira as disappointingly low.
The institution noted that there has been slow growth concerning wallet downloads among retail users.
The IMF noted that the majority of the eNaira accounts were inactive and had an average of 14,000 eNaira transactions per week.