The Bank of Ghana (BOG) explains why the country’s central bank is establishing a digital currency (CBDC). In addition, the bank’s governor states in the paper that the organization is open to recommendations that will aid in the effective introduction of digital currency.
Transparency in the Financial System
The BOG also stated that it “considers CBDC to be of strategic importance to a progressive and digitally inclusive society” elsewhere in the text. It goes on to say that the digital currency has since been developed to satisfy the central bank’s strategic aims, one of which is to increase financial inclusion.
“The e-design Cedi’s concepts, particularly accessibility and consecutive offline payments, would help to the government’s goals of digitizing Ghanaian society and boosting financial inclusion,” the document states.
Other strategic objectives for digital currency include assisting in the digitization of the economy and increasing consumer use of digital payments. According to the BOG, the e-cedi would address the dangers posed by “unregulated privately issued digital currencies.” In contrast, a digital cedi would be able to “fill the demand for digital currencies while creating no systemic problems.”
Central Bank Digital Currency Strengths
The Ghanaian central bank recently published a statement highlighting the main reasons for its desire to establish a digital currency (CBDC). The document also discusses the design of digital money and the advantages it will bring to the Ghanaian economy.
The Bank of Ghana (BOG) began constructing the CBDC in 2021, and it was hoped that the digital currency would be piloted by the end of the year. The BOG announced in August 2021 that Giesecke Devrient would be its implementation partner. Prior to that, Mahamudu Bawumia, Ghana’s vice president, had supported the central bank’s intention to launch digital money. He also believes that a currency like this may help improve intra-Africa trade.
Some stakeholders, such as Afroblocks, a blockchain lobbying group that claims it was not engaged, have encouraged the central bank to create a digital currency that is not based on “old traditional compartmentalized financial thinking.” According to Afriblocks, doing so improves the e-chances cedi’s of success.
However, the BOG governor, Ernest Addison, attempts to reply to opponents’ concerns in a statement that accompanies the paper. The BOG would “extensively engage stakeholders to the maximum practicable for their active engagement and successful implementation,” according to Addison’s statement.
Also Read: Bank of Israel: CBDC will have Minimal Effect on the Banking System
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