BIS REPORT FINDS UNEVEN PROGRESS, DIFFERING MOTIVATIONS IN AFRICAN CBDC ADOPTION

Last updated: June 19, 2025, 21:08 | Written by: Katie Haun

The digital currency landscape in Africa is a fascinating and rapidly evolving space.While cryptocurrencies have captured headlines, a quieter revolution is brewing: the exploration and potential adoption of Central Bank Digital Currencies (CBDCs). Mobile money has been a strong competitor to central bank digital currency (CBDC) in Africa, but many of the continent s central bankers have greater faith in CBDC, according to a Bank forA recent report by the Bank for International Settlements (BIS) sheds light on this complex issue, revealing uneven progress, diverse motivations, and the ever-present competition from established mobile money solutions. Many African central banks have shown interest in or are developing Central Bank Digital Currencies (CBDC), according to a recent report by the Bank for International Settlements (BIS). The study, which collected data from 19 central banks in the region, showed that the motivations differed from those in other areas.The report, which surveyed 19 central banks across the continent, paints a picture of cautious optimism tempered by practical challenges. Africa: BIS report finds uneven progress, differing motivations in African CBDC adoptionAfrican central bankers, it seems, are keenly aware of both the potential benefits and the potential pitfalls of introducing a digital form of their national currencies. BTCUSD Bitcoin BIS report finds uneven progress, differing motivations in African CBDC adoption A survey of the continent's central banks shows optimism about greater efficiency and inclusion, but several drawbacks remain; Nigeria already has an operational retail CBDC.This journey towards CBDC implementation is not a uniform one; each nation navigates its unique economic landscape, regulatory environment, and the pre-existing dominance of mobile money platforms. Market Cap: $2,422,017,220,782.13 24h Vol: $70,584,531,977.31 BTC Dominance: 55.76% Home; Coins MarketCap; Crypto Exchanges; Crypto Calculator; Top Gainers and LoserThe question remains: can CBDCs truly gain traction and offer unique value propositions in a market already saturated with digital payment options?And what are the specific goals driving this interest in digital currencies amongst African nations?

The findings of the BIS report offer valuable insights into these questions, providing a glimpse into the future of digital finance in Africa.Understanding these trends is crucial for anyone involved in the financial sector, policymakers, and individuals seeking to navigate the increasingly digital world of money.

Motivations Behind African CBDC Exploration

The BIS report highlights that African central banks are driven by a unique set of motivations when exploring the possibility of issuing CBDCs. Mobile money has been a strong competitor to central bank digital currency (CBDC) in Africa, but many of the continent s central bankers have greater faith in CBDC, according to a Bank for International Settlements (BIS) report published Nov. 24.While increased payment system efficiency is a common goal shared with other regions, several factors are particularly relevant to the African context.

Enhancing Payment System Efficiency

Like their counterparts globally, African central banks are eager to modernize their payment infrastructure. CBDCs offer the potential to streamline transactions, reduce reliance on cash, and lower transaction costs. BTCUSD Bitcoin BIS report finds uneven progress, differing motivations in African CBDC adoption. A survey of the continent's central banks shows optimism about greater efficiency and inclusionThis is especially crucial in regions where access to traditional banking services is limited.

Reduced transaction fees
Faster payment processing
Increased transparency

Imagine a small business owner in a rural area who currently relies on cash transactions.A CBDC could allow them to accept digital payments from customers, expanding their market reach and simplifying their financial management.

Strengthening Monetary Policy Transmission

A significant finding of the BIS report is the emphasis placed on monetary policy implementation. A survey of the continent s central banks reveals optimism about greater efficiency and inclusion, but a number of drawbacks remain; BIS report: uneven progress, differing motivations in African CBDC adoption Nigeria already has a retail CBDC that is working. According to a Bank for International Settlements (BIS) report that was released on November 24, mobileIn many African nations, the traditional mechanisms for influencing economic activity are weak. Mobile money has been a strong competitor to central bank digital currency (CBDC) in Africa, but many of the continent s central bankers have greater faith CBDC, according to a Bank for International Settlements (BIS) report published Nov. 24. African central bankers also saw greater utility in CBDC for implementing monetary policy thanCBDCs could provide a new tool for central banks to directly impact the money supply and interest rates, potentially leading to more effective economic management.African central bankers also saw greater utility in CBDC for implementing monetary policy than bankers in other [ ].

For example, a central bank could directly distribute stimulus payments through a CBDC, ensuring that the funds reach the intended recipients quickly and efficiently. Mobile money has been a strong competitor to central bank digital currency (CBDC) in Africa, but many of the continent s central bankers have greater faith CBDC, according to a Bank for International Settlements (BIS) report published Nov. 24. African central bankers also saw greater utility in CBDC for implementing monetary policy than bankers in other [ ]This direct control over the money supply could be particularly valuable during economic crises.

Promoting Financial Inclusion

Financial inclusion is a major priority across Africa, and CBDCs are seen as a potential solution for reaching the unbanked population.By providing access to a digital form of currency, CBDCs could empower individuals to participate in the formal economy, access credit, and build wealth.

Reduced reliance on cash, making it easier to save and invest
Access to digital payment systems for those without bank accounts
Lower transaction costs compared to traditional banking services

Consider a farmer who lives far from a bank branch. BIS report finds uneven progress, differing motivations in African CBDC adoption Derek Andersen 20 摘要: A survey of the continent s central banks shows optimism about greater efficiency and inclusion, but several drawbacks remain; Nigeria already has an operational retail CBDC.A CBDC could allow them to receive payments for their crops electronically, eliminating the need to travel long distances to cash checks and providing them with a secure and convenient way to manage their finances.

Cross-border Payments

Cross-border payments in Africa are often costly and inefficient. BIS report finds uneven progress, differing motivations in African CBDC adoption Mobile money has been a strong competitor to central bank digital currency (CBDC) in Africa, but many of the continent s central bankers have greater faith CBDC, according toCBDCs could potentially streamline these transactions, reducing fees and settlement times. Overall, the likelihood that central banks will issue a wholesale CBDC within the next six years now exceeds the likelihood that they will issue a retail CBDC. Central banks further enhanced their engagement with stakeholders to inform CBDC design.This is particularly important for promoting trade and investment within the continent.

A business importing goods from another African country could use a CBDC to make payments directly to the supplier, bypassing intermediaries and reducing transaction costs.This could significantly boost intra-African trade and economic integration.

Challenges and Drawbacks of CBDC Adoption

Despite the potential benefits, the BIS report also acknowledges the significant challenges and drawbacks associated with CBDC adoption in Africa. 柬埔寨王国（Kingdom of Cambodia） 1.历史1863年，柬埔寨沦为法国保护国。高棉帝国国旗法国柬埔寨保护国国旗日占柬埔寨国旗2025年9月，日本占领柬埔寨。 2025年3月13日，日本胁迫西哈努克亲王独立。8月15日，These hurdles must be addressed carefully to ensure the successful implementation of digital currencies.

Competition from Mobile Money

Mobile money is a dominant force in the African digital payments landscape.Platforms like M-Pesa have revolutionized financial access, particularly in countries with limited banking infrastructure. Lower Costs Helped Tyson Foods Post Better-Than-Expected Results. FebruCBDCs face stiff competition from these established players, which already offer convenient and widely adopted digital payment solutions.

For a CBDC to succeed, it must offer compelling advantages over existing mobile money services.This could include lower transaction fees, greater security, or unique features that cater to specific needs.

Infrastructure Limitations

Reliable internet access and widespread smartphone adoption are essential for the successful implementation of CBDCs.However, many parts of Africa still face significant infrastructure limitations, which could hinder the adoption and use of digital currencies.

Investing in infrastructure development is crucial for bridging the digital divide and ensuring that all citizens can benefit from the potential of CBDCs.This includes expanding internet access, improving mobile network coverage, and promoting digital literacy.

Cybersecurity Risks

CBDCs are inherently vulnerable to cybersecurity threats. BIS report finds uneven progress, differing motivations in African CBDC adoption Posted on Novem by RJM Mobile money has been a strong competitor to central bank digital currency (CBDC) in Africa, but many of the continent s central bankers have greater faith CBDC, according to a Bank for International Settlements (BIS) reportProtecting the digital currency infrastructure from hacking, fraud, and other malicious activities is paramount.Robust security measures and constant vigilance are essential to maintain the integrity of the system.

Central banks must invest in advanced cybersecurity technologies and expertise to safeguard CBDC systems. Africa Survey Africa: BIS report finds uneven progress, differing motivations in African CBDC adoptionThis includes implementing multi-factor authentication, encryption protocols, and regular security audits.

Privacy Concerns

The potential for central banks to track and monitor CBDC transactions raises significant privacy concerns.Balancing the need for transparency and regulatory oversight with the protection of individual privacy is a delicate balancing act.

Clear regulations and guidelines are needed to ensure that CBDC transactions are handled in a privacy-respecting manner. Like their peers, a key motivation for African central banks is achieving greater payment system efficiency. In addition, a higher proportion than in other regions see potential benefits for monetary policy, an important consideration for a region where the transmission mechanism is weak.This could include implementing anonymization techniques and limiting the amount of data that is collected and stored.

Uneven Progress Across the Continent

The BIS report highlights that progress towards CBDC adoption is uneven across Africa. A survey of the continent s central banks shows optimism about greater efficiency and inclusion, but several drawbacks remain; Nigeria already has an operational retail CBDC. Mobile money hasSome countries, like Nigeria, have already launched retail CBDCs, while others are still in the early stages of exploration and research.

Nigeria's eNaira: A Case Study

Nigeria's eNaira is a notable example of a functioning retail CBDC in Africa.While the eNaira has faced challenges in terms of adoption and usage, it provides valuable lessons for other countries considering implementing their own digital currencies. Trusted News Discovery Since 2025. Global Edition. Wednesday, JanuNigeria already has a retail CBDC that is working.According to a Bank for International Settlements (BIS) report that was released on November 24, mobile Mobile money has

The eNaira's experience demonstrates the importance of user education, seamless integration with existing payment systems, and addressing cybersecurity concerns.

Wholesale vs.Retail CBDCs

The BIS report notes that African central banks are currently more likely to issue wholesale CBDCs than retail CBDCs.Wholesale CBDCs are designed for use by financial institutions for interbank payments and settlements, while retail CBDCs are intended for use by the general public.

This focus on wholesale CBDCs suggests that African central banks are prioritizing efficiency improvements in the financial system before tackling the more complex challenges of implementing retail CBDCs.

Engagement with Stakeholders

The BIS report emphasizes the importance of stakeholder engagement in the CBDC design process.Central banks are increasingly engaging with the public, businesses, and other stakeholders to gather feedback and ensure that CBDCs meet the needs of their users.

This collaborative approach is essential for building trust and ensuring the successful adoption of CBDCs.By involving stakeholders early in the process, central banks can identify potential challenges and tailor CBDC designs to meet the specific needs of their communities.Central banks further enhanced their engagement with stakeholders to inform CBDC design.

Key Takeaways and Future Outlook

The BIS report provides valuable insights into the evolving landscape of CBDCs in Africa.While the potential benefits are significant, the challenges are equally daunting.The success of CBDC adoption will depend on careful planning, strategic partnerships, and a deep understanding of the unique economic and social context of each country.

African central banks are motivated by a desire to enhance payment system efficiency, strengthen monetary policy transmission, and promote financial inclusion.
Mobile money poses a significant competitive challenge to CBDCs.
Infrastructure limitations and cybersecurity risks must be addressed.
Progress towards CBDC adoption is uneven across the continent.
Stakeholder engagement is crucial for successful implementation.

Frequently Asked Questions About CBDCs in Africa

What is a Central Bank Digital Currency (CBDC)?

A Central Bank Digital Currency (CBDC) is a digital form of a country's fiat currency, issued and regulated by the central bank.It's essentially a digital version of cash, offering potential benefits like increased efficiency, lower transaction costs, and greater financial inclusion.

How do CBDCs differ from cryptocurrencies?

While both CBDCs and cryptocurrencies are digital currencies, they differ significantly in their nature and control.CBDCs are issued and regulated by central banks, providing stability and trust backed by the government.Cryptocurrencies, on the other hand, are typically decentralized and operate on blockchain technology, making them more volatile and subject to less regulation.

What are the potential benefits of CBDCs for African countries?

CBDCs offer several potential benefits for African countries, including:

Increased financial inclusion: Providing access to financial services for the unbanked population.
Reduced transaction costs: Lowering fees for digital payments.
Enhanced payment system efficiency: Streamlining transactions and reducing settlement times.
Strengthened monetary policy transmission: Improving the effectiveness of monetary policy tools.
Cross-border payment facilitation: Simplifying and reducing the cost of international transactions.

What are the main challenges to CBDC adoption in Africa?

The main challenges include:

Competition from mobile money: Established mobile money platforms already offer convenient digital payment solutions.
Infrastructure limitations: Insufficient internet access and smartphone penetration in some areas.
Cybersecurity risks: Protecting the CBDC infrastructure from cyberattacks.
Privacy concerns: Balancing transparency with the protection of user privacy.
Regulatory uncertainty: Establishing clear legal and regulatory frameworks for CBDCs.

What is the future of CBDCs in Africa?

The future of CBDCs in Africa is uncertain but promising.While challenges remain, the potential benefits are significant.As infrastructure improves, regulatory frameworks evolve, and user adoption increases, CBDCs could play a transformative role in shaping the future of finance in Africa.Continued monitoring and adaptability will be vital for successful implementation.