BoG’s digital currency not crypto currency – Banking consultant

On Tuesday, July 2, 2013, all commercial banks started implementing this new formula for calculating the minimum lending rate for borrowers. 

Contrary to some views that the Bank of Ghana is set to introduce crypto currency into the economy, Banking Consultant Nana Otuo Acheampong has explained that the electronic digital currency scheduled to be piloted by the central bank in September is not a crypto currency.

According to him, unlike crypto currencies, electronic digital currencies are highly regulated by central banks across the world to achieve efficiency in the financial ecosystem.

He added that the introduction of the digital currency will also help the Bank of Ghana to supervise and shape all electronic payment platforms in the country to reduce cost associated with financial transactions. “With crypto currency there is no master who controls the activities that go on there, but with the electronic digital currency, there is a regulator supervising everything that goes on there,” he explained.

First Deputy Governor of the Bank of Ghana, Dr. Maxwell Opoku Afari on July 12, 2021 told journalists that the central bank is ready to pilot the country’s first digital currency known as the e-cedi in September – adding that it is expected to operate in a sandbox environment in the temporary, before introducing to the general public as legal tender for financial transactions.

Even though digital currencies are seen as cash on its own, meaning it will not be backed by any money or commodity but just like the normal paper cash, Nana Otuo Acheampong stressed that the existence of a regulator in the field makes it different form crypto currency, hence legal tender for transactions just like a fiat cash.

“One major advantage of this system is the efficiency and speed with which funds will be transferred electronically in buying and selling or transacting businesses.”

Signaling Ghana as one of the few countries to pursue such a move on the continent, Nana Otuo Acheampong was of the view that the decision to introduce the currency fits with the Bank of Ghana’s objective of maintaining its position as Africa’s leader when it comes to embracing emerging financial technologies.

He added that the move will also deepen Ghana’s access to global financial transaction platforms to enhance the country’s payment system.

By this, he maintained that the Bank of Ghana will provide a platform on which more value will be added to digital transactions, linking Ghana’s financial transactions to international platforms. With the drive to reduce cash in circulation, Nana Otuo Acheampong was of the opinion that the exercise will help Ghana accelerate its financial inclusion objectives.

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