- Ghana aims to make its central bank digital currency (CBDC) to work offline.
- Smart cards will enable E-cedi to work offline.
As per a report by Bloomberg on Monday during the Ghana Economic Forum, Kwame Oppong, head of FinTech and Innovation at the Bank of Ghana (BoG), it was announced that Ghana aims to make E Cedi offline.
The virtual version of a fiat currency is referred to as central bank digital currency (CBDC). A CBDC is a digital token or electronic record of a country’s official currency. As such, the monetary authority or central bank of the country issues and regulates it. As a result, they are backed by the issuing government’s full faith and credit. By incorporating the unbanked into the financial system, CBDCs can ease the execution of monetary and fiscal policy and enhance financial inclusion in an economy.
The offline capabilities, according to Oppong, would allow Ghanaians without dependable access to power and internet connectivity to embrace the country’s CBDC.
“The E-Cedi would also be able to be used in an offline environment. Thanks to certain smart cards. What we hope to be able to do – and we’re one of the people pioneering this – is to be able to use the e-cedi in an offline environment through some smart cards,” he added.
According to the report, the e-cedi will function offline by using smart cards. Smart cards, like current bank cards, are physical cards with a chip inserted in them.
The Bank of Ghana has been intending to issue a CBDC since at least 2019 and stated earlier this year that it was in advanced stages. Ghana started in July that the e-cedi will be implemented in September, but it has yet to begin.
CBDCs are being studied by more than 80 countries across the world. China might well be experimenting with a smart card-based solution for its digital yuan. Nigeria on the other hand is preparing to introduce its eNaira in October, while the European Central Bank launched a two-year trial for a digital euro.
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