Thank you for your article and the mention of the eNaira and the challenges it has faced since launch. While I agree that user adoption has been limited due to the prevalence of existing digital channels like mobile and USSD banking, I believe the more fundamental reason for the eNaira’s struggles lies in a deeper misalignment of its business model and execution strategy.
At its core, the Central Bank of Nigeria (CBN) took an unusual path by attempting to play both the role of issuer and distributor of the eNaira. This contrasts sharply with the traditional Naira distribution model, where the CBN mints the currency, but licensed financial institutions handle distribution, customer relationship, and innovation. This model has proven to be robust, scalable, and efficient, yet it was largely set aside in the initial rollout of the eNaira.
Instead, the CBN chose to launch a consumer-facing app and assumed the operational complexities of a B2C retail model—an area outside its core competence. Financial institutions were brought in later, almost as an afterthought, and in a highly restricted capacity that limited their incentive or ability to drive meaningful adoption. This approach disrupted the existing ecosystem rather than building on it.
Moreover, while the CBN positioned the eNaira as “the same Naira with more possibilities,” the reality was quite the opposite. The eNaira, by regulatory design, was stripped of some fundamental characteristics that make digital money useful—most notably, its inability to generate interest or be used in investment vehicles. In contrast, traditional bank-held Naira retains these essential financial properties, giving individuals and businesses far more flexibility and incentive to keep their funds within the existing banking system.
In many ways, it appears the eNaira was rushed to market more as a symbolic leap into the CBDC space than as a carefully planned, user-centric innovation. By prioritizing speed over usability and ecosystem collaboration, the project missed the opportunity to harness the strengths of Nigeria’s already vibrant digital financial infrastructure.
A more inclusive and collaborative rollout—one that leveraged the distribution expertise of banks and fintechs—could have dramatically changed the adoption trajectory of the eNaira. Instead of competing with banks and fintechs, the CBN could have empowered them, creating a network effect that benefited everyone in the financial ecosystem, especially the end users.
Pretty robust submission. I largely agree with your take and it feels as though the CBN does too. While we don't have the specifics of their thinking, they certainly feel there's room for better execution for the enaira. Will the second time be the charm?
Hi Muyiwa,
Thank you for your article and the mention of the eNaira and the challenges it has faced since launch. While I agree that user adoption has been limited due to the prevalence of existing digital channels like mobile and USSD banking, I believe the more fundamental reason for the eNaira’s struggles lies in a deeper misalignment of its business model and execution strategy.
At its core, the Central Bank of Nigeria (CBN) took an unusual path by attempting to play both the role of issuer and distributor of the eNaira. This contrasts sharply with the traditional Naira distribution model, where the CBN mints the currency, but licensed financial institutions handle distribution, customer relationship, and innovation. This model has proven to be robust, scalable, and efficient, yet it was largely set aside in the initial rollout of the eNaira.
Instead, the CBN chose to launch a consumer-facing app and assumed the operational complexities of a B2C retail model—an area outside its core competence. Financial institutions were brought in later, almost as an afterthought, and in a highly restricted capacity that limited their incentive or ability to drive meaningful adoption. This approach disrupted the existing ecosystem rather than building on it.
Moreover, while the CBN positioned the eNaira as “the same Naira with more possibilities,” the reality was quite the opposite. The eNaira, by regulatory design, was stripped of some fundamental characteristics that make digital money useful—most notably, its inability to generate interest or be used in investment vehicles. In contrast, traditional bank-held Naira retains these essential financial properties, giving individuals and businesses far more flexibility and incentive to keep their funds within the existing banking system.
In many ways, it appears the eNaira was rushed to market more as a symbolic leap into the CBDC space than as a carefully planned, user-centric innovation. By prioritizing speed over usability and ecosystem collaboration, the project missed the opportunity to harness the strengths of Nigeria’s already vibrant digital financial infrastructure.
A more inclusive and collaborative rollout—one that leveraged the distribution expertise of banks and fintechs—could have dramatically changed the adoption trajectory of the eNaira. Instead of competing with banks and fintechs, the CBN could have empowered them, creating a network effect that benefited everyone in the financial ecosystem, especially the end users.
Thank you
Pretty robust submission. I largely agree with your take and it feels as though the CBN does too. While we don't have the specifics of their thinking, they certainly feel there's room for better execution for the enaira. Will the second time be the charm?
Thank you for sharing your insights!