Nigeria's central bank digital currency (CBDC) dubbed eNaira may cause new money-laundering/financing of terrorism (ML/FT) risks, the International Monetary Fund warned in a recent report.
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Although the CBDC brings financial inclusion and reduces informality, Nigeria's digital currency may also pose "disintermediation risks" as digital wallets may be considered by citizens as "safer and more convenient than commercial bank deposits," the IMF noted.
Launched in October 2021, eNaira still carries macro-financial, cyber security, operational, financial integrity and stability, and legal risks, the organization says.
Notwithstanding, the IMF believes that eNaira can enhance the Nigerian payment ecosystem and boost tax collection. However, the local government needs to fix existing deficiencies in the AML/CFT framework which could exacerbate these risks, the IMF emphasized.
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