| Popis: |
PURPOSE – On October 25, 2021, Nigeria, Africa’s largest economy launched the continent's first digital currency, the eNaira. The eNaira is the digital form of the Naira, issued by the Central Bank of Nigeria in line with Section 19 of the Central Bank of Nigeria Act. This paper critically examines the Central Bank of Nigeria’s digital currency, named eNaira. Its aim is to determine if the eNaira project does strike a fair balance between financial inclusion and anti-money laundering and combating the financing of terrorism (AML/CFT) measures. DESIGN/METHODOLOGY/APPROACH – The analysis took the form of a desk study, which analyzed various documents and reports such as the Central Bank of Nigeria’s 2021 Press Release on its Digital Currency Project; Central Bank of Nigeria’s Regulatory 2021 Guidelines on the eNaira; the Financial Action Task Force 2020 reports on ‘Money Laundering and Terrorist Financing Red Flag Indicators Associated with Virtual Assets; the Financial Action Task Force 2019 Guidance for a Risk-Based Approach to Virtual Assets and Virtual Asset Service Providers; and the Financial Action Task Force (2012-2021), International Standards on Combating Money Laundering and the Financing of Terrorism & Proliferation (the FATF Recommendations). FINDINGS – This paper determined that the Central Bank of Nigeria’s regulatory approach to its digital currency named eNaira could foster financial inclusion and at the same time mitigate the AML/CFT risks associated with its digital currency. However, the paper identified “a poor culture of compliance” and “employee fraud and money laundering” as factors that could weaken the CBN’s anti-money laundering regime for the eNaira if left unchecked. ORIGINALITY/VALUE – While many have written articles on Central Bank of Nigeria’s Digital Currency named eNaira, none of those articles critically analyzed the effects of the eNaira project on financial inclusion and AML/CFT measures. This paper critically examines the effects of the Central Bank of Nigeria’s digital currency dubbed “eNaira” on financial inclusion and AML/CFT measures. Its aim is to determine if the eNaira project does strike a fair balance between financial inclusion and AML/CFT measures. The paper will provide recommendations on how the financial inclusion and AML/CFT measures of the eNaira could be strengthened. This is the only article to adopt this kind of approach. |
