The Bank of Ghana has assured that its quest to implement the digital currency, also known as the e-cedi, will not disrupt or collapse the mobile money (MoMo) system.
According to the regulator, the implementation will rather be a positive one in the MoMo value chain.
Speaking at the MTN Momo Stakeholder Forum organised which explored the impact of the Central Bank’s digital currency on future monetary policy and digital payment, the Assistant Director in charge of Fintech and Innovation at the BoG, Clarence Blay, maintained that the Central Bank is committed to protecting the businesses of MoMo Agents as it positions itself to implement the e-cedi.
“Concerning those who are currently facilitating access to digital payments as agents, this is going to be a positive disruption. It means that all the actors in the space are going to benefit. The Central Bank is not going to issue a fiat that everything has to be digital currency.”
He added, “We recognize that the space is made up of diverse persons with diverse needs and for inclusivity, it is important that the need of everyone is catered for. Some will want physical cash, others will want digital currency. We are not trying to take away cash and replacing it with digital currency. We are responding to everyone’s needs.”
When questioned as to whether the digital currency will have the electronic transfer levy applied in any form, Clarence Blay explained that “the E-cedi is a currency. The Central Bank issues currencies with no tax attached to them. If there’s going to be any levy at all, it’ll be a levy on transactions. But the e-cedi as it is now, has no levy on it”.
The government has adopted digitization as a key policy and has recently introduced a number of programs including the Ghana Post digital address system, mobile money interoperability and the e-cedi which is yet to be operational, in order to develop a more digitally accessible public sector and encourage transparency.
The digital Cedi, or ‘e-Cedi’, is intended to complement and serve as a digital alternative to physical cash, thus driving the Ghanaian cash lite agenda through the promotion of diverse digital payments, while ensuring a secure and robust payment infrastructure in Ghana.
It also aims to facilitate payments without a bank account, contact, or smartphone, by so doing boosting the use of digital services and financial inclusion amongst all demographic groups.
In this regard, the banking community has been tasked to be proactive in developing specific digital products for different types of customers with the introduction of the e-cedi.
The Central Bank announced plans to start a three-phased pilot of the currency to determine its feasibility and subsequent circulation in June last year.
But at the MoMo Stakeholder Forum, the regulator insisted plans are far advanced for the implementation to be done. It however failed to give any deadlines or timelines for the introduction.
On his part, CEO of MTN Mobile Money Limited, Eli Hini, urged Mobile money vendors to brace themselves for the positive impact that will come with the implementation of the digital currency.
He insists that “just like mobile money came to create opportunities for people, other innovations will come with its opportunities, and we should be ready to embrace it as much as possible”.
“Today, our settlement cycle takes a bit of time but the implementation of the e-cedi will address that problem so that we won’t have to hold money and wait for settlement to happen before we can have value. Also, our if our agents want to do rebalancing of their float, they have to carry physical cash to the bank. The e-cedi will help to address that and speed up the process. So innovation will always come and you have to make use of them,” he explained.
The MoMo Stakeholder Forum was organized as part of MTN Ghana’s mobile money month celebration.
According to Mr. Hini, the event was organized to allow the “Central Bank have the opportunity to educate all of us on the objectives, background and what the overall picture looks like when it comes to the e-cedi”.