A Look At Which African Countries Are Setting Up Their Own Central Digital Currency

Money has evolved through different mediums over the years. With the onset of technological innovation which has seen several sectors digitised, central banks are not being left out. In keeping with the times, central banks have resorted to creating digital currencies for their citizens.

Digital currency is the digitised version of a country’s currency used as a medium of exchange and is generated, managed, and stored electronically. They are typically stored in e-wallets rather than in your bank accounts and they cannot be withdrawn as physical cash. The version of digital currency being run by central banks is called Central Bank Digital Currencies (CBDCs).

African Central Banks Exploring CBDC

This report estimates that more than 80% of central banks have launched or are considering launching a CBDC. According to this CBDC tracker, in Africa, only Nigeria has gone live with its currency. Two African countries are in the pilot stage while 10 countries are still in the research and development phase. Egypt is inactive and Senegal has canceled.

Image Credit: Premium Times Nigeria

Central banks have said that establishing a digital currency is in their National economies’ best interest. The CBN Governor of the Nigerian state echoed this same sentiment when he announced the launch of the e-Naira, Africa’s first live CBDC. According to him, the fiat currency had the potential to contribute to the growth of the Nation’s GDP by 29B dollars over the next 10 years. 

CBDCs issuance can be classified into two broad types- Retail CBDCs and Wholesale CBDCs

Retail CBDC such as the e-Naira, targets Individual consumers, the private sector, businesses, and non-financial consumers as its end users. For now, however, the e-Naira transaction types available to individual consumers include peer-to-peer transfers (P2P), peer-to-business (P2B), and peer to governments (P2G)

The Ghana e-Cedi which is in the pilot stage is implementing a retail CBDC to bank the unbanked demographic and by doing so aims to foster financial inclusion and the use of digital services.  

Wholesale CBDCs on the other hand are mostly targeted at financial institutions for related wholesale transactions. 

South Africa

Image Credit: Ledger Insights

South Africa, which is the second country initiating small-scale testing of CBDC on the continent, is experimenting with a wholesale CBDC. The South African Reserve Bank detailed the experimentation of a wholesale Central Bank Digital Currency (wCBDC) as the second phase of Project Khokha.


The Harare Institute of Technology (HIT) Zimbabwe, recently announced that it would be responsible for developing the country’s CBDC. The vice-chancellor of the institution said the digital currency will be built on blockchain technology and is aimed at digitsing trust & transparency, as well as eliminating cash hoarding and black market trading.

Eswatini, Kenya, Morocco, Namibia, Rwanda, Tanzania, Tunisia, Uganda, Zambia, and Zimbabwe are all currently in the research stage of CBDC development (which means it has established working groups to explore the use case, impact, and feasibility of CBDC).

Meanwhile in Namibia, the Governor of the Bank of Namibia at a recent leadership event held at the Nation’s capital announced that a whitepaper on CBDCs will be released soon to further display the government’s commitment to transforming the financial sector.


Undoubtedly, centralised digital currencies hold many benefits for national economic growth and as such, it is in a Nation’s best interest to explore the potential. Considering that different types of CBDC exist, different countries will most likely explore a model that is aligned with its specific goal and capabilities.

African countries exploring CBDCs. Image Credit: Atlantic Council

Risks such as cyber-attacks, vendor & technology risks, and possible systemic failures, are factors that have caused central banks to approach the concept of digital currency development with necessary caution. 

Although CBDCs are in their early stages, central banks will need to invest in their understanding and technological capability of the concept. A successful launch will require cooperation between central banks and commercial banking institutions.

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