Central Bank Seeks Views on Introduction of Digital Kenya Shilling

Central Bank of Kenya (CBK) on Thursday invited the public to submit their views on the introduction of a virtual version of the Kenya shilling.

This is the first time the State monetary authority is seeking the opinion of Kenyans regarding a central bank digital currency (CBDC) as it looks to keep pace with global financial innovations.

“Whilst CBDC offers opportunities to reduce costs associated with digital payments, it also comes with risks particularly related to cybersecurity and unknowns on how it would impact central banks’ core functions of monetary policy, financial stability, and payment systems oversight,” CBK says as quoted by Business Daily.

CBDC would be “a sovereign currency in an electronic form and it would appear as a liability on CBK’s balance sheet and an asset to users holding it”, according to CBK.

Should Kenyans back the idea and get implemented, CBK will be issuing printed cash as well as the electronic equivalent. The public has 120 days to submit their views. 

Experts say the use of digital currency will not only eliminate the cost of printing cash but also lower the cost of transactions.

Nigeria unveiled its digital currency dubbed eNaira in October last year while Ghana is at an advanced stage of launching its e-Cedi. Other countries that are considering the digital currency technology include the United States, Canada, China, Turkey, and India.