The Bank of Ghana (BoG) in a report has indicated that the eCedi will be implemented to forestall disruptions to the existing payment systems.
The central Bank noted that in recent years, the idea of issuing digital currencies by various central banks has been topical around the globe.
The BoG in the eCedi Design Paper report, noted that it is part of the first few African central banks to declare its intention to pilot a Central Bank Digital Currency (CBDC) within the framework of its financial sector digitization program and the overall digitization agenda of the Government of Ghana.
BoG further explained that the digital cedi is a retail token-based CBDC, a value based approach that implies an eCedi that represents a token or a digital value note. Payment is done by transferring the value note from one person to another.
The concept is similar to cash payment transactions, where payment is done by transferring banknotes and/ or coins from person A to person B.
“It is particularly important that the eCedi is implemented to forestall disruption to the existing payment space. For this reason, the eCedi will be integrated into the existing interbank payment systems and mobile money interoperability platform operated by the Ghana Interbank Payment and Settlement Systems Limited (GhIPSS),” said the BoG.
“The eCedi has to be accessible to everyone and any part of the country. Absence of mobile data networks in the rural areas of Ghana should not serve as a barrier to the use of the eCedi. In other words, the eCedi should work effectively in both online and offline environments.
“Speed of payment is very important from a consumer`s perspective. The transfer of funds from a payer to a payee should be near instant, easy to confirm and traceable. Both the sender and receiver should receive a confirmation of a successful transaction. Similar to cash, an eCedi transaction will be free of charge to consumers.
“By this approach, the eCedi would be a strong contender of cash, promote competition in the payment market and facilitate the provision of innovative value-added services to individuals and businesses by banks and payment service providers at affordable fees and charges.
“In the era of the globalisation, it is important that domestic CBDCs are designed with the prospects of adaptation for interoperability with CBDCs of other jurisdictions. Efforts to accelerate integration of the economies of African economies, particularly under the African
“The Africa Continental Free Trade Area (AfCFTA) makes this a key consideration in the eCedi design. The eCedi takes into consideration CBDC standards, making it possible for Ghana to participate in international projects on cross border CBDCs,” it added.