The e-Naira is coming soon, Kenyans are skeptical about vaccines and its stressing coffin makers
Welcome to a new month. You’ve made it to September!
Have a terrific month ahead. Don’t forget:
The e-Naira is coming soon
The days of counting money like this would soon be behind as Nigeria is still on course to launch the e-Naira — its own digital currency — on October 1.
*Checks calendar.* That’s less than a month away.
Yup. With cryptocurrencies like Bitcoin becoming increasingly popular, central banks across the world have been working towards developing digital currencies of their own.
So far only two countries have officially launched a digital fiat currency. The Bahamas became the first in 2020 followed by China, which began issuing its digital yuan about four months ago. In Africa, Egypt, South Africa, Morocco, and Kenya are exploring the technology’s feasibility, but only Nigeria (e-Naira) and Ghana (e-Cedi) have plans to pilot official digital currencies this year.
Back up a little bit here, what’s this digital currency about?
Central Bank Digital Currencies (CBDCs) are digital currencies issued by the government. They’re similar to cryptocurrencies because they run on blockchain, but they’re not necessarily cryptocurrencies. For one, the e-Naira will not fluctuate in value like Bitcoin or other cryptocurrencies. It’s simply the digital currency version of the paper tender of the Naira, so ₦1 = 1 e-Naira.
Tell me more
To distinguish it from the normal Naira, the e-Naira will be housed in wallets created independently of bank accounts. The digital currency will be accessible to both bank and non-bank account holders.
The Central Bank of Nigeria has created three tiers of wallets for Nigerians interested in this wallet.
The Tier 1 wallet is open to anyone without a bank account, with an opening requirement of a National Identification Number. It has a transfer limit of ₦50,000 ($115)
Tier 2 wallets have transfer limits of ₦200,000 ($478) daily and a balance of ₦500,000 ($1,196).
Tier 3 wallet holders can transact up to ₦1,000,000 ($2,329) daily with the cumulative balance set at ₦5,000,000 ($11,961). For both Tier 2 and 3, a Bank Verification Number (BVN) is required.
Okay, I get it but what problem does this e-Naira solve?
Cashless economy. Digital currencies mean less money will be printed. According to the Central Bank of Nigeria‘s annual report, ₦307 billion ($750M) was spent on printing banknotes between 2014 and 2019. Yikes!
Easier to track Fraud. Since it’s all digital, cases of financial fraud can be easily tracked. Unlike paper money, the government can easily monitor the flow of money in and around the country and it’s difficult to counterfeit.
In the grand scheme of things, it's supposed to improve payment efficiency, revenue and tax collection, amongst other things.
Why it matters: At this point, I’m sure you might be nodding your head, saying nice but how does this concern me or the layman on the street. Well, as far as we know those using the e-Naira won’t have to pay charges for transactions. That’s all for now.
Kenyans are skeptical about vaccines and its stressing coffin makers
"We heard that Kenya was making Covid-19 vaccines, that's why we are scared. They don't even know how to make matchboxes or even toothpicks."
— Jane Wangari Kahemu, a mask vendor in Kenya
In Kenya, the government plans to make its own Covid-19 vaccines sometime in the future but for now, it has a bigger issue on its hands. It’s struggling to convince citizens to take vaccines.
Hmm, tell me about it
Most people aren’t keen on taking vaccines because they’ve heard about the extremely rare blood clots associated with the AstraZeneca vaccine, the only brand of vaccine available until recently.
Skepticism towards vaccines is such a big deal that the government has legally mandated civil servants to get vaccinated.
Meanwhile, hospitals are filled with patients who are in critical conditions, as per CNN, official nationwide data shows an average of 20 deaths per day in the past week.
And the Coffin makers?
It’s no longer business as usual. Business is booming. Coffin makers are stressed by the increase in the demand for coffins caused by these deaths. Before the pandemic, they were making less than one coffin a day, in some cases only one per week. Now they’re making about 10-15 a day. The workforce has also been doubled to keep up with demand as per CNN.
Zoom out: It’s not clear if all these deaths are caused by COVID but at least In all this, Kenya has struggled with vaccine supply since day one. So far only 3.6 million doses (only enough to vaccinate roughly 3.5% of the population) have arrived in Kenya, with the latest shipment coming from the UK just this week.
Worth reading 📚
We think we understand the rules when we become adults, but what we really experience is a narrowing of the imagination.
– David Lynch