All you need to know about BoG’s eCedi

The document revealing details about the eCedi indicated it will be accessible to everyone and any part of the country, adding “absence of mobile data networks in the rural areas of Ghana should not serve as a barrier to the use of the eCedi”.

The central bank also added that the digital currency which it intends to issue will be free of transaction charges to consumers just as in the usage of cash.

Additionally, the banking regulator said in a report released Tuesday that the eCedi was the digital equivalent of the physical cedi by design and as such would not bear interest (i. e. has a zero interest rate), just as cash.

The Central Bank, amid its pilot phase and subsequent rollout of the electronic cedi (eCedi), has created two wallets for the Central Bank Digital Currency (CBDC).

The apex bank in its eCedi Design Paper report, asserts the two wallets created include Hosted Wallets which will be managed by the various financial institutions in the country and Hardware Wallets which are secure portable storage devices held by individuals.

According to the Bank of Ghana (BoG), Hosted Wallets require access to the internet to be operational whereas Hardware Wallets work in offline mode.

“The most optimal form factor for the eCedi wallet is the app for a smartphone developed by commercial banks, FinTech companies, and other service providers. Other devices can be utilized depending on user preferences and payment scenarios. These could be smartcards (including the biometric ones) or wearables such as smart watches that contain communication capabilities and a secure element.

“Similarly, debit cards and USSD devices (feature phones) which are associated with the existing payment landscape in Ghana can be adapted for eCedi. Thus users can get the type of wallet that suits their needs from a bank or other financial service provider,” noted the Bank.

The BoG in the report further asserts that the eCedi will be a retail token-based CBDC. A retail token-based eCedi is 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.

Devices to be used to host eCedi online Pulse Ghana

In brief, retail CBDC is digital cash that is designed to take on most traditional attributes of physical cash (in practice, though, it may have other additional

Retail CBDC could be used by individuals for P2P transfers, and P2B, B2P, B2B, P2G, and G2P payments besides cash and existing payment media and instruments (e-money, payment cards, etc.)

Devices to be used to host eCedi offline Pulse Ghana

Per the apex bank, it has developed the eCedi to meet the following strategic goals:

Increase digitization of the Ghanaian economy;
Foster financial inclusion and consumer adoption of digital payments;
Anticipate the future role of BoG as an active regulator and facilitator of a digital economy;
Foster the possibility of a more secure, efficient, and resilient payment system;
Address the risk of unregulated privately issued digital “currencies” or virtual assets.