ASSESSING E-NAIRA USER CHALLENGES BY FEATURE PHONE USERS
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The general market and the majority of financial markets have changed greatly. In this sense, trading systems have evolved and adapted to market demands, with the goal of making business transactions as simple as possible through the development of digital currencies (Grinberg and Ruben 2012). In light of this, there has been fast growth and the emergence of several digital currencies.
A digital currency is a digital representation of either virtual currency (non-fiat) or e-money (fiat) and so is often used interchangeably with virtual currency (Charles 2018). According to FATF (2014), digital currency is a digital representation of value that is digitally transferred while functioning as a medium of exchange, unit of account, and store of value, and it operates completely via agreement among virtual currency users.Digital currencies have acquired acceptability in the previous few decades, and have steadily and substantially expanded, thereby having a significant impact on the global economy as well as individuals’ financial capacity (UNB2021). However, digital currencies such as the virtual currency or e-money as articulated by Franco (2015) would have acquired twice the development it has gained so far if not limited to only smart phone users. Digital currencies are made accessible to computer and smart phone users, thereby cutting off feature phone users from using this services. As a result, its expansion, general acceptability, and usability have been severely limited (Franco 2015).
Regardless of this constraint, countries such as China, Sweden, etc., established a digital currency for their own respective local currencies, considering the significance of digital currencies and its economic benefits (McKarle 2019). Likewise , the Nigerian government have designed a digital currency for the country, called e-Naira. eNaira is a central bank digital currency (CBDC) issued by the Central Bank of Nigeria as a legal tender (Jaizbankplc (2021). It is the digital form of the Naira and will be utilized just like the Naira notes. Furthermore, Wale (2021), postulated that the e-Naira would function as a wallet against which customers could hold existing funds in their bank accounts, and that the currency would accelerate financial inclusion, allowing for cheaper and faster remittance inflows. On the other hand, e-Naira is a legal tender just like the Naira, which must be accepted by both individuals and business outlets as a means of payment in the country (Emeka, 2021). Following this new development and the mandated usage of the eNaira platform in Nigeria, it is therefore paramount to the challenges and possibilities of feature phone users to access the platform.
1.2 STATEMENT OF THE PROBLEM
Feature phone users are individuals who only utilize non-smartphones, which do not belong in the smartphone category. It is also known as a basic or a feature phone. According to Miller (2013), a feature phone is a type or class of mobile phone that retains the form factor of earlier generations of mobile telephones, including press-button-based controls and a small non-touch display. Users of this sort of phone are dominant in rural areas of Nigeria. These users have limited access to numerous internet-oriented services such as the eNaira platform. Consequently, with this category of phone users not having access to eNaira services, one of the key purposes for the development of eNaira, which is "Financial Inclusion," may be thwarted (Abdulkareem, 2021). In light of this, there is a need for the eNaira platform to facilitate the populace who are uneducated, unexposed, and lack access to internet services. According to Temitayo (2021), asserted that 35 per cent (37.1 million) of the nation’s adult population are illiterates. He further claimed that this segment of the population is not accustomed with the use of smart phones, while others cannot afford them. In addition, with the youths who are feature phone users inclusive, there would be over 37.1 million Nigerians who are feature phone users and, as such, may not consider the eNaira platform relevant and necessary to run (Temitayo 2021). Therefore, this study focused on unveiling the challenges of feature phone users in the use of the eNaira platform.
1.3 OBJECTIVE OF THE PROBLEM
The general aim of this study is to assess eNaira user challenge by feature phone users. To achieve this, the study will;
1. Examine the extent to which feature phone users are aware of eNaira platform.
2. Investigate the challenges feature phone users will encounter in the use of eNaira platform.
3. Identify the possible solution to the challenges which maybe encountered by feature phone users.
1.4 RESEARCH QUESTION
The study will be guided by the following questions;
1. What is the level of feature phone users awareness of eNaira platform?
2. What are the possible challenges which feature phone users may encounter in the use of eNaira platform?
3. What are the ways through which those challenges can be managed?
1.5 SIGNIFICANCE OF THE STUDY
The end result of this study will be invaluable to Centre Bank of Nigeria, authorities. This is due to the fact that this study will deeply and critically unveil the major possible challenges feature phone users may encounter in the use of eNaira platform. Hence, this study will serve as a source of information to CBN officials as it will enlighten them on the need to implement measure which will ensure one of the aims for establishing eNair which is financial inclusion is met adequately.
This study will also add to the body of existing literature on this topic and other related topics, hence will be useful to students and researchers who may be carrying out further studies on related topics.
1.6 SCOPE OF THE STUDY
This study is channeled to assess eNaira user challenge by feature phone users. To achieve this, the study will focus on examining the extent to which feature phone users are aware of eNaira platform, investigating the challenges feature phone users will encounter in the use of eNaira platform, and identifying the possible solution to the challenges which maybe encountered by feature phone users. Hence the respondents for this study will be obtained from feature phone users in Aba North, Aba, Abia State, Nigeria.
1.7. LIMITATIONS OF THE STUDY
In the course of carrying out this study, the researcher experienced some constraints, which included time constraints, financial constraints, language barriers, and the attitude of the respondents.
In addition, there was the element of researcher bias. Here, the researcher possessed some biases that may have been reflected in the way the data was collected, the type of people interviewed or sampled, and how the data gathered was interpreted thereafter. The potential for all this to influence the findings and conclusions could not be downplayed.
More so, the findings of this study are limited to the sample population in the study area, hence they may not be suitable for use in comparison to other schools, local governments, states, and other countries in the world.
1.8 DEFINITION OF TERMS
Challenge: This an uneasy situation or a factor which servers as an impediment to the success of an activity.
Feature Phone: A feature phone is a type or class of mobile phone that retains the form factor of earlier generations of mobile telephones, with press-button based inputs and a small non-touch display.
eNaira: It is the digital form of the Naira and will be used just like cash. It can also be defined as a digital currency made available by the central bank of Nigeria and serves as a legal tender, medium of exchange, and store of value.
REFERENCE
Abdulkareem Mojeed, (2021) Businesses in Nigeria must accept e-Naira. Retrieved from https://www.premiumtimesng.com/news/more-news/486095-businesses-in-nigeria-must-accept-e-naira-cbn.html
Charles (2018).The Cripto-Currency: Bitcoin and Its Mysterious Inventor.
Emeka Anaeto (2021): CBN gets set for eNaira, more measures put in place. Retrieved from https://www.vanguardngr.com/2021/09/cbn-gets-set-for-enaira-more-measures-put-in-place/
Financial Action Task Force (2014). «Virtual Currencies: Key Definitions and Potential AML/CFT Risks.
Franco (2015). Understanding bitcoin, Cryptography engineering and economics.
Grinberg, and Ruben (2012), Understanding bitcoin, Cryptography engineering and economics.
Jaizbankplc(2021), ENAIRA. https://jaizbankplc.com/enaira/
McKarle (2019); “Money in the digital age: what role for central banks: digital currencies: looking beyond the hype.
Miller, Hugo (2013). "RIM says 150 carriers keep it from Palm's fate (Toronto)". www.TheSpec.com. TheSpec.com – Metroland Media Group Ltd. Archived from the original on 17 January 2013.
Technology in Selected Small and Medium Enterprises.
Temitayo Jaiyeola(2021), Nigerians can use eNaira without internet. https://punchng.com/nigerians-can-use-enaira-without-internet-says-cbn/
UNB (2021), Digital Currency: Benefits and Risks of the Cashless Economy.
Wale Odunsi (2021): E-Naira: Things to know as CBN launches Nigeria’s digital currency. Retrieved from https://dailypost.ng/2021/09/18/e-naira-things-to-know-as-cbn-launches-nigerias-digital-currency/
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