E-Cedi facts for kids
The E-Cedi is a new type of digital money planned for Ghana. It's like a digital version of the Ghanaian cedi, which is Ghana's regular money. Instead of physical coins or paper notes, the E-Cedi will be electronic. It's being developed by the Bank of Ghana, and Dr. Ernest Addison, who leads the bank, announced it in June 2021. This digital money will be backed by the Ghanaian government, just like regular cash.
Contents
What is the E-Cedi?
The E-Cedi is a central bank digital currency (CBDC). This means it's a digital form of a country's official money, issued and controlled by the country's central bank. For Ghana, this is the Bank of Ghana. The E-Cedi will be electronic tokens, which are like digital coins or notes. They will be used on mobile phones and other apps.
Why is Ghana Creating the E-Cedi?
The E-Cedi is part of a bigger plan called the 'Digital Ghana Agenda'. This plan aims to make many things in Ghana digital, including how people pay for things and how government services work.
The E-Cedi will:
- Work alongside the physical Ghanaian cedi (cash).
- Offer an alternative to using physical cash.
- Help more people get access to banking services, especially those who don't have bank accounts. This is called financial inclusion.
Key Steps in the E-Cedi's Journey
The E-Cedi project has three main steps:
- Design: Planning how it will work.
- Implementation: Building the system.
- Piloting: Testing it out with a small group.
The Bank of Ghana is working with a company called Emtech. Emtech is a fintech company, which means it uses technology to improve financial services. They help central banks with digital changes and test new solutions, including those using blockchain technology.
Important Announcements
- August 20, 2021: Ghana's President, Nana Akufo-Addo, said that the E-Cedi will "completely change how we pay for things" and help more people join the financial system.
- August 28, 2021: Dr. Ernest Addison, the Governor of the Bank of Ghana, announced that Ghana was on track to launch its digital currency. He also said the E-Cedi would be the first general-purpose central bank digital currency in Africa.
- September 2021: The Bank of Ghana started the pilot stage of the E-Cedi. This stage helps them test the digital currency and make sure it works well.
- September 30, 2021: Ghana confirmed it was in advanced stages of developing its state-backed digital currency, making it one of the first African countries to do so.
- October 2021: Kwame Oppong, who leads fintech and innovations for the Bank of Ghana, shared that the E-Cedi would allow people to make payments even when they are offline (without internet).
