The Bank of Central African States (BEAC), also or Banque des États de l’Afrique, which serves Cameroon, Gabon, Chad, the Republic of Congo, Equatorial Guinea and the Central African Republic (CAR), is on it’s way to become the first regional bank on the continent to launch a common digital currency all things being equal.
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BEAC was urged to advance the move by its board of directors in meetings held on July 20 and 21 in Cameroon’s economic Douala, Bloomberg reported on Friday (July 22). The central bank for the region was also urged to promote regional financial inclusion.
The board’s call to action was emailed in a statement signed by its head, Herve Ndoba following the meetings, according to the report.
Stablecoins and central bank digital currencies (CBDCs) could replace fiat for payments in the pan-African region but issues around regulatory compliance and interoperability would have to be addressed first.
Also Read: Bank of Central African States’ Governor Rebukes Central African Republic CAR For Bitcoin Adoption.
The Central African Republic, or CAR, passed legislation adopting Bitcoin (BTC) as legal tender in the country in April but has not recognized a central bank digital currency.
Nigeria’s central bank was one of the first in the region to launch a CBDC called the eNaira in October 2021, while South Africa’s Reserve Bank continues to explore the possible use of a CBDC through its Project Khokha initiative. The Bank of Central African States also criticized the CAR for accepting BTC as legal tender, calling the move “problematic” and something that could have a “substantial negative impact” on the monetary union of Central Africa.
Sub-Saharan African nations could face significant challenges introducing cryptocurrencies and CBDCs to areas with limited access to electricity, both for transfers and mining. According to 2020 data from the World Bank, the CAR and Chad both rank among the lowest percentages of the population with access to electricity, at 15.5% and 11.1%, respectively.
Since Nigeria’s launch of the e-naira in October 2021, several sub-Saharan African central banks are eyeing digital currencies or are already in the trial stages of a launch plan, Bloomberg reported. The central bank’s move toward a common digital currency follows opposition to the CAR’s adoption of Bitcoin in April.
The CAR is planning to start selling its own cryptocurrency, Sango Coin, with sales set at a minimum investment of $500, payable in cryptocurrency.
Sales of the new coin are set to begin today, Monday (July 25) according to a press release. President of CAR Faustin-Archange Touadéra announced the adoption of Bitcoin as a legal tender on April 21.
