Ghana proposes the use of hardware wallets to support the new digital currency

The Central Bank of Ghana has stated that inclusivity will be a major feature in its planned digital currency, the eCedi, and that the money will be made available to those who do not have a bank account or even internet access. The bank advocated the usage of hardware wallets and other devices with the eCedi in a design document released on Tuesday.

Ghana’s central bank has detailed its ideas for a retail, token-based central bank digital currency (CBDC). According to the bank, integrating digital payments will help legitimise the African economy. In this way, it will make eCedi adoption as painless as possible.

Ghana’s central bank is looking into hardware wallets and smart cards

 

To draw unbanked people into the eCedi system, the central bank advocated issuing offline wallet gadgets or possibly smart cards. According to Statista, over 43% of Ghana’s population does not have access to a bank account.

The eCedi’s offline feature, which is intended for rural areas with limited internet connectivity, is also influenced by the ideas for an offline wallet. According to a World Bank research from 2019, 53 percent of Ghanaians use the internet. To facilitate offline peer-to-peer transactions, the central bank offered offline wallet devices, smart cards, and even smart wristbands.

However, the bank did not specify how this would be accomplished.

A smartphone with a banking app, according to the bank, is the best method to utilise the eCedi. The most frequent methods of transacting in the country are mobile and card-based payments, and the eCedi will supplement existing digital payment networks. The overall value of mobile money transactions increased by 82 percent between 2019 and 2020, according to the central bank.

The move coincides with a surge in interest in CBDCs

 

Ghana has announced plans for the eCedi in 2021, as the country sought to digitise its economy in order to boost growth and combat corruption. Giesecke+Devrient, a German payments firm, is working on the system. The decision is also a result of Africa’s greatest gold producer’s growing economic growth.

Given its potential application in local and international transactions, several industrialised and developing economies have launched CBDC forays. According to the Atlantic Council, more than ten other African countries are considering CBDCs as well.

Following China’s launch of its digital yuan earlier this year, the US recently stated that it is considering producing a digital dollar.

 

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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