Public Perception Of Nigeria Electronic Naira (E-naira). A Study Of Kano Metropolis.

Public Perception Of Nigeria Electronic Naira (E-naira). A Study Of Kano Metropolis.

Chapiter 1

Introduction

1.1 The study’s context

Without a question, the present technological shift from actual physical currency to essentially virtual currencies is being embraced by the international financial system. Rapid technical advancement and new business models have resulted in a plethora of innovative retail payment solutions in recent years. These findings suggest significant adjustments to the retail payment landscape, including a decline in the use of cash. This tidal surge gave rise to innovations in digital money.

Digital currencies, like printed banknotes or minted coins, have characteristics that are similar to those of traditional currencies, although they frequently lack a physical form, according to Gilbert, Scott, and Loi, Hio. (2018). The absence of a tangible form enables almost immediate internet transactions and eliminates the expense of shipping money and coins. As a result, digital currencies will continue to be helpful for inter-party transactions as long as both parties acknowledge the legitimacy of the currency because they offer the benefit of quick settlement, particularly in online communities. The majority of governments around the world have refrained from endorsing or granting any sort of legitimacy to transactions carried out through such channels, so even though cryptocurrency is the most well-known type of digital currency, there are thousands of others in the modern world. Each of them operates and enjoys security thanks to the mutually adopted encryption codes by the parties in such transactions.

Nigeria has not been left behind in the transition of international economies from paper currency to digital currency as a result of taking advantage of this rapid advancement in technology and financial industry development. According to Abdulkareem M. (2021), central banks around the world have been carefully developing their digital currencies by gradually weaning themselves off of rapidly declining cash payments. The Central Bank of Nigeria joined the fray in order to ensure that Nigeria is not left behind, which led to the launch of her e-Naira in March 2021, after instructing banks to close cryptocurrency exchanges and forbid accounts related to cryptocurrencies in February 2021 (premiumtimesng.com). The effects on the effectiveness of the payment system and any potential problems associated with the implementation of these schemes, however, remain to be seen. Therefore, should digital currencies become widely used for high-value transactions or for asset types other than funds transfers, their impact on other areas of responsibility for central banks, like payment system oversight and regulation, financial stability and monetary policy, as well as related tendencies of fraud and money laundering, may become more prominent, posing a relatively high risk for general users.

A follow-up to this requirement has emerged with the anticipated release of the e-Naira guidelines, sparking considerable public attention.The possibility of successful implementation of the recommendations in a way that will impact the public interest most profitably without unnecessary risks is of key interest to the Nigerian public. The exposure to those who aren’t digitally compliant is still high given that transactions in this method don’t involve the actual exchange of money but rather take place on computers, which are still mostly unknown to most Nigerians.

1.2 A description of the issue

Before the introduction of the electronic naira, the paper naira in Nigeria had been subject to a catastrophic foreign exchange crisis, and the rate of the naira’s depreciation had caused inhabitants to express grave anxiety, necessitating the need to try an other form of legal money. Additionally, as CBN warned in the year, cryptocurrencies are now restricted, necessitating the transition of the national currency from paper to electronic. According to Kalu (2021), the Central Bank of Nigeria created its own digital currency to reduce the cost of managing paper money, take advantage of newly emerging digital technologies, enhance the environment for digital readiness, mature identification registries, and promote financial inclusion. While the advantages of digital money in enabling quick transactions are notable, the negative repercussions of the practice should not be understated.

Adolphus (2021) noted that at the time, the nation’s financial sector was displaying significant difficulties as a result of bad administration, which have persisted. Therefore, it should not be allowed for the introduction of the e-Naira to make the problems in the industry worse. Therefore, it is imperative to ensure that all project operators have a track record that can be verified and a level of integrity that the public can rely on. The cloudy situation of effective implementation of the ideas, which lack public education and enlightenment in regard to the smooth transition of more Nigerians to digital transactions, is closely related to the worries.

The editor of Daily Trust publication (2021) stressed that the general public is beginning to be concerned about the security of this new digital currency and the degree to which it is susceptible to hackers and fraudsters. This is due to the prevalence of unlawful activities carried out by fraudsters in Nigeria through internet transactions, shady money transfers, clearing of accounts, western wire transfers, and account hacking. As a result, this has given the public a terrible impression of the e-naira, causing them to worry about the security of their wallets should they bank with the CBN and what the implications of the digital currency hold for them as users. Therefore, it is crucial to carefully evaluate this situation. Therefore, utilizing Kano State as a case study, this study intends to evaluate how Nigerians’ perceptions of the electronic Naira (e-naira) are perceived by the general population.

1.3 Purpose of the investigation

This study’s main goal is to investigate how Nigerians perceive the electronic Naira (e-naira) by using Kano State as a case study. The research specifically aims to:

1. Examine whether the introduction of the e-naira will make financial transactions easier for the general public.

2. Find out how the general population feels about the drawbacks of utilizing e-naira.

3. Determine the advantages of the Nigerian launch of the e-naira.

1.4 Question for research

The following query will serve as the research’s compass:

1. Would the public’s ability to conduct financial transactions be made easier by the advent of the e-naira?

2. Will using the e-Naira platform provide any difficulties for the general public?

3. What advantages would the launch of the e-naira bring to Nigerian citizens and businesses?

4. Would there be a need to inform the public even more about this new development?

1.5 Importance of the research

The study’s conclusions will be useful to policymakers, the government, and the general public. The study’s findings will shed light on the necessity for the government, policy makers, and economic developers to devote greater attention to this recent development in order to allay public reservations and fears regarding the use of e-naiara. The study’s findings will help other economic sectors that this new development will have an impact on prepare for the issues that will come with the launch of the e-Naira and find a method to downplay it so they can continue to be relevant in the evolving business environment. The study’s findings will, in the end, contribute to the body of literature and be used as a tool for academics and students who seek to pursue additional research in a related topic.

1.6 Study’s range of inquiry

The goal of this survey is to examine how the public feels about the e.Naira. The study will also ascertain whether there are anticipated difficulties e-Naira customers may encounter when using the platform. However, the study is only focused on Kano Metropolis in Nigeria’s Kano State.

1.7 The study’s limitations

While conducting the study, the researchers ran into some minor obstacles, just as in every human endeavor. The researcher had to choose from a small number of sample sizes because there was a limited amount of literature available on the topic because it is a new discourse. As a result, the researcher had to spend more money and time looking for the necessary materials, literature, or information as well as conducting the data collection. The researcher will also work on other scholarly projects while conducting this study. However, despite the limitations, all of these limitations were minimized to provide the best.

1.8 Definition of key words

Digital currencies serve the same roles as traditional currencies, such as serving as a unit of account, a store of value, and a medium of exchange, but they exist solely as electronic data.

The first suggested digital currency by the CBN is called eNaira. The Central Bank of Nigeria has created the legal tender central bank digital currency (CBDC) known as the eNaira. The Naira can be used much like cash in its digital version.