Key Takeways
- Ghana to partner with a German firm to develop CBDC
- Digital Cedi to function similarly to fiat currency
- Other African countries joining the CBDC race
The apex bank announced on Wednesday that it had entered a memorandum of understanding (MoU) with G&D to develop the digital cedi. The German company focuses on developing banknotes and securities and has sufficient experience in developing digital currencies.
Ghana central bank intends to test the digital cedi within the existing banking system with financial service providers and institutions before deploying it to the public. The partnership with G&D is the latest in a series of events from the Bank of Ghana.
The bank had announced in the early months of 2021 that it would be launching a digital currency as part of a new digitization policy. This, according to the apex bank, would place the African nation with the growing financial trend.
In July, Maxwell Opoku-Afari, the deputy central bank governor, revealed that the digital cedi would have the same functions as the fiat currency. This provided a major insight that the government intended to use the CBDC for both wholesale and retail finance.
Local reports have stated that the central bank expects to begin test operations in September with the view to launch before the end of the year. Ghana has shown a leadership position regarding cryptocurrencies in comparison to other African nations.
It is one of the few countries in the region with existing crypto laws. In comparison neighbors, Nigeria has been largely hostile to crypto-assets. However, the central bank of Nigeria appears to be changing with a proposed e-naira set to be released soon.
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