The International Monetary Fund (IMF) is warning Nigeria that eNaira could be compromised by fraudsters and used for money laundering and terrorist financing.

The International Monetary Fund said the risks are imminent and could result in lawsuits.

These risks exist despite the many benefits of eNaira such as financial inclusion.

The Central Bank of Nigeria (CBN) was therefore urged to address the issues quickly.

The warning is contained in a new report released by the IMF following the conclusion of its 2021 Article IV consultation with the West African country.

According to the IMF, the risks are imminent and could lead to legal action. This is despite the many advantages of eNaira such as financial inclusion and the potential for easy cross-border remittances. He therefore recommended some solutions, emphasizing the need for the Central Bank of Nigeria to quickly resolve the perceived problems.

Part of the IMF report states: “Possible expansion of the use of eNaira to cross-border remittances and bank branch networks may lead to new money laundering/terrorist financing risks…There are financial integrity risks that are mitigated through the use of tiered identity verification. system and applying tighter controls to relatively less verified users.

Recall that in October 2021, Nigeria became the first African country to launch a central bank digital currency and one of the first in

world. Since then, other countries are considering doing the same. In December 2021, Bank of Tanzania Governor Florens Luoga revealed that the East African country’s digital currency projects were underway.

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