The Bank of Ghana has begun testing the country’s first digital currency, the ‘e-Cedi,’ in the country’s Western North area.
The action is part of the Bank’s commitment to increasing the use of digital financial services in the country, as well as attempts to determine its practicality and subsequent circulation.
In addition, the results of this pilot phase are critical for a full-scale implementation of the e-cedi.
Governor of the Central Bank, Dr. Ernest Addison, stated at the 6th Ghana CEO Summit in Accra that digitizing the offline transactions of rural and frontier families holds the key to developing the essential market connections that could lead to future access to financing.
“The eCedi initiative is progressing quickly, in line with the Bank’s commitment to the sector’s digitization. Because one of the goals of the CBDC pilot is to increase financial inclusion, the Bank decided to test an offline version of the eCedi that may be used for sequential payments between consumers and merchants in areas where there is no connectivity infrastructure, exactly like cash.
The offline version of the eCedi is now being tested in Sefwi Asafo in Ghana’s Western North area. Select members of that community have begun using the eCedi to make everyday transactions including food, groceries, and beverages. The Bank will continue to collaborate with these customers to collect crucial usage statistics that will help influence the eCedi’s future after the pilot. “These are obviously watershed moments in giving digital leadership with payment systems, paving the way for a digitized economy in the not-too-distant future,” he said.
The E-Cedi is part of the ‘Digital Ghana Agenda,’ which entails digitizing the country of 30 million people and its infrastructure.
The digital Cedi, or ‘e-Cedi,’ is designed to complement and act as a digital alternative to physical cash, supporting the Ghanaian cashlite agenda by promoting a variety of digital payments while maintaining a secure and resilient payment infrastructure.
It also intends to make payments easier for people who don’t have a bank account, a phone number, or a smartphone, hence increasing the usage of digital services and financial inclusion across all demographic categories.
Design, implementation, and pilot will be the three phases of the project.
All framework parameters for the CBDC pilot will be determined and defined throughout the design phase.
These comprise the country’s economic, regulatory, and technological needs, as well as the specifications for the test phase.
In the second phase, G+D’s CBDC solution would be modified for the Ghanaian environment based on these unique criteria.
During the pilot phase, a user group with a wide range of demographic and socioeconomic backgrounds will evaluate the solution in the field utilizing a variety of channels and form factors, including mobile apps and smart cards.
A research on the acceptance of the e-Cedi from the standpoint of end users will be done during the pilot project.
In addition, the infrastructure’s IT security, the project’s impact on monetary policy and payment systems, and the legal consequences will be assessed.
The Bank of Ghana and G+D would learn vital insights from the pilot user experiences in preparation for a statewide launch of the e-Cedi.
“CBDC gives a wonderful chance to establish a healthy, inclusive, competitive, and sustainable financial sector, led by the Central Bank,” said Dr. Ernest K. Y. Addision, Governor of the Bank of Ghana. According to all indicators, the notion will play a key role in the global delivery of financial services in the future. This endeavor is a key step toward putting Ghana in a position to fully exploit this new concept.”
“Central banks around the world are exploring the introduction of digital money as legal tender. The Ghanaian government is one of the first African countries now entering a pilot phase. We are proud to support Ghana with our technology and expertise,” emphasized Dr. Wolfram Seidemann, CEO of the Giesecke+Devrient Currency Technology business sector.
Filia, G+D’s CBDC solution, combines the benefits of today’s currency with the demands of consumers in a digitally-driven society. Filia ensures excellent security, availability, and resilience, as well as the capacity to protect user data while meeting regulatory standards.
In addition, if there is no network connection, the system allows for secure, successive offline payments.