According to a report published on November 24 by the Bank for International Settlements (BIS), many of the central bankers on the African continent have more faith in CBDCs than mobile money, which has been a strong competitor to the digital currency of the central banks (CBDC) in Africa. Mobile money has been a strong competitor to CBDCs in Africa.
According to the BIS, central bankers in Africa saw greater utility in CBDCs for monetary policy implementation than bankers in other parts of the world.
In response to the survey that served as the basis for the report, nineteen different central banks in Africa gave their responses and all indicated that they had an active interest in CBDCs.
Only Nigeria has issued a retail CBDC, called eNaira, that is intended for the general public. Ghana is currently in the process of piloting a retail CBDC project, and South Africa is in the process of running a project for a wholesale CBDC, which is intended to be used by institutions.
The provision of cash was cited as one of the main motivations for the introduction of a CBDC by African central bankers in responses from 48 percent of survey participants.
They believed that a CBDC would generate savings in the costs of printing, transporting and storing notes and coins.
All respondents mentioned the importance of financial inclusion.
In the year 2021, less than half of the adult population of Africa had their DNA banked.
Two-thirds of the world’s total volume of money transfers comes from sub-Saharan Africa, and more than half of all users are located there.
According to the report’s findings, CBDC participation in this market may result in increased competition and lower prices.
“support new digital technologies and their integration with the broader economy.” would be one of the goals of a CBDC.