Editorial : The e-cedi conundrum

Gov’t revenue target still low, can be better – IEA

The Bank of Ghana’s (BoG) decision to implement an e-cedi currency came like a bolt from the blue, and has got tongues wagging.

The electronic currency is among other reasons aimed at enhancing low transaction costs, improving security of payments as well as ensuring higher monetary transaction limits.

According to the 2021 PwC Ghana Banking Survey Report, the banking industry looks forward to additional consultation and dialogue with the BoG, as they believe such further consultation will enable greater understanding of the e-cedi and assist their preparedness toward its successful implementation.

Firstly, the banks demand the BoG must involve the industry in developing legislation and regulations governing the e-cedi, while 80% of executives interviewed expect the regulator to consult the industry in determining a pricing structure for e-cedi-based products.

The banks have a view that implementation of the e-cedi will be a success if the BoG clearly publishes costs that will be incurred as a result of infrastructural requirements associated with the project.

There is currently insufficient clarity around legislation/regulations, technical and funding support that will be availed, and the role expected of banks in the currency’s deployment. This makes banks uneasy about any potential demands that the central bank will place on them when it launches the e-cedi.

Therefore, though the central bank has signalled its intention to introduce the electronic currency into the Ghanaian economy soon, we are of the considered opinion that a much broader consultation with industry players will see implementation of the digital currency take off smoothly.

However, as it currently stands, bankers are still in a fix about terms and conditions of the intended project. While it is on the BoG’s timetable to roll out the e-currency in the not-too-distant future, we believe deeper consultations with the various banks is required for it to catch on seamlessly.

This is important, because according to the PwC survey there is still a lack of clarity on many issues that must be addressed for a smooth take-off of the project.

According to the report, the banks identified insufficient knowledge about the technology and currency form by both staff and customers of banks, funding, and regulatory uncertainty as the top-three challenges currently associated with the e-cedi project.

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