Head of Digital and Inclusive Banking at Calbank, Martha Acquaye has said that it eCedi wallets attracts interest like mobile money wallets do, it will impact cash deposit in banks negatively and that can trigger high lending rates.
She is therefore appealing to the Bank of Ghana to ensure that in its final design of the eCedi, post the ongoing pilot, eCedi wallets should be made interest free.
Martha Acquaye was speaking at the recent Stakeholder Forum on the Impact of Central Bank Digital Currency (CBDC) on the Future of Digital Payments, organized by Mobile Money Limited (MTN MoMo) as part of its MoMo Month celebrations.
The forum featured four key presentations from the regulator (Bank of Ghana), Fintech (IT Consortium), telco (MTN MoMo) and bank (Calbank) on how to mainstream Ghana’s CBDC, the eCedi for digital payments when it is finally rolled out.
Calbank is one of three institutions participating in the ongoing eCedi pilot. The other two are IT Consortium and Vodafone Ghana.
In her presentation, Martha Acquaye argued that if the regulator allows eCedi wallets to attract interest, people are more likely to keep a significant chunk of their bank deposits in their eCedi wallets and once the money is in that wallets, banks cannot to access it for loans and other investments.
”When that happens, cash will be scarce at the banks and that will drive lending rates higher,” she explained. “Since BoG says the eCedi design is not meant to disadvantage any stakeholder, we expect that eCedi wallets will not attracts interest so that cash deposits in banks are not adversely affected.”
She also noted that during the pilot, one trend they have observed is that people like to cash out money from their eCedi wallets and use it more than making payments directly from the wallets.
According to her, going forward, the bank is training and empowering merchants to educate users on how to make use of their eCedi wallets for payments directly, instead of cashing the money out.
Speaking of education, CEO of Mobile Money Limited, Eli Hini emphasize the need for massive and constant public education on how eCedi works as a way of driving adoption. He also stressed the need for an equally massive investment in infrastructure to ready the entire ecosystem for the adoption of eCedi for payments.
He explained that trust and immediate availability are critical for the adoption of eCedi and without education and the backbone infrastructure for the entire ecosystem, those two ingredients will be missing and that roll affect adoption of eCedi.
Deputy Head Fintech and Innovation at BoG, Clarence Blay said in terms of infrastructure, there is no need to reinvent the wheel, so the eCedi rollout will be done through the existing digital wallets developed by telcos, fintechs and banks, adding however that the inefficiencies in the existing infrastructure will not be taken onboard.
He said, per the design, eCedi will be rolled out on the indirect model, where users still remains customers of the various private stakeholders like banks, fintechs and telcos, with the central banks only serving as the regulator.
Clarence Blay said the central bank in committed to deepening financial inclusion with eCedi and that is why it designed both online and offline versions to ensure that immediate availability at all times.
CEO of IT Consortium, Romeo Bugyei believes that with the understanding Ghanaians now have of mobile money and the existing digital payments infrastructure, eCedi adoption will be much quicker than mobile money.
He therefore urged his colleague fintechs to commit to investing in their infrastructure and provide their customers the eCedi option in addition to their other innovative offerings.