The Bank of Ghana has partnered with Giesecke+Devrient (G+D) to pilot a general-purpose Central Bank Digital Currency (retail CBDC) in Ghana.
G+D is providing the technology and developing the solution adapted to Ghana’s requirements, which will be tested in a trial phase with banks, payment service providers, merchants, consumers and other relevant stakeholders.
To this end, the Bank of Ghana has signed an agreement with G+D to implement a pilot CBDC project as a precursor to the issuance of a digital form of the national currency, the cedi.
The project is part of the ‘Digital Ghana Agenda’, which involves the digitisation of the country of 30 million people and its government services.
The digital cedi, or ‘e-cedi’, according to the central bank, is intended to complement and serve as a digital alternative to physical cash, thus, driving the Ghanaian cashlite agenda through the promotion of diverse digital payments while ensuring a secure and robust payment infrastructure in Ghana.
It also aims to facilitate payments without a bank account, contract, or smartphone, thus, boosting the use of digital services and financial inclusion amongst all demographic groups.
The project, according to the BoG, will be divided into three phases: design, implementation, and pilot.
In the design phase, all framework parameters for the CBDC pilot will be specified and defined. These include economic, regulatory, and technical requirements of the country as well as the definition of the parameters for the test phase.
In accordance with these individual requirements, G+D’s CBDC solution would be adapted for the Ghanaian context in the second phase.
In the pilot phase, a user group of diverse demographic and socio-economic backgrounds will test the solution in the field using different channels and form factors such as mobile apps and smart cards. Over the course of the pilot project, a study will be conducted on the acceptance of the e-Cedi from the end users’ perspective.
In addition, the IT security of the infrastructure, impact of the project on monetary policy and payment system, and the legal implications will be evaluated. Insights from pilot user experiences would then provide Bank of Ghana and G+D with valuable lessons for a nationwide rollout of the e-Cedi.
Dr. Ernest K. Y. Addison, Governor of the Bank of Ghana, stated: “CBDC presents a great opportunity to build a robust, inclusive, competitive and sustainable financial sector, led by the Central Bank. From all indications, the concept has a significant role to play in the future of financial service delivery globally. This project is a significant step towards positioning Ghana to take full advantage of this emerging concept.”
“Central banks around the world are exploring the introduction of digital money as legal tender. The Ghanaian government is one of the first African countries now entering a pilot phase. We are proud to support Ghana with our technology and expertise,” Dr Wolfram Seidemann, CEO of the Giesecke+Devrient Currency Technology business sector stated for his part.