eNaira application usage by our bank's customer

Power point on analysis of e-naira

1. Project GIANT FI FAQs Saturday, 11 September, 2021

2. FAQs: General Project GIANT 1 Category S/N Question Answer General What is eNaira? eNaira is a central bank digital currency (CBDC) issued by the Central Bank of Nigeria as a legal tender. It is the digital form of the N aira and will be used just like cash. What is an eNaira wallet? The eNaira wallet is a digital storage that holds the eNair a. It is held and managed on a distributed ledger. The eNaira wallet is required to access, hold and use eNaira. Is eNaira a cryptocurrency? No, it is not. eNaira is a legal tender backed by law, the full sovereignty of Nigeria, and issued by the Central Bank of Nigeria. Cryptocurrencies are private digital currencies, not backed by law, underlying assets or by the sovereignty of any nation. They are not legal tender currencies. eNaira is a unit of account, store of value and medium of exchange. Cryptocurrencies do not have all these qualities 4. What makes eNaira different from the money in my bank account ? eNaira is the digital form of the cash and is a direct liability on the Central Bank of Nigeria while the customer deposits are direct liabilities on the financial institutions . eNaira transactions are direct transfers while transact 5. In a typical transaction, what is the difference between an online bank transaction and eNaira wallet? For the typical online bank transaction, there are intermediaries whereas for eNaira transactions, there are no intermediaries 6. What are the benefits of eNaira ? The benefits of the eNaira are: Fast, cheap, reliable and available payment channels. Support digital economy. Improved economic activities. Simplified and easy cross border payments and trade. Inclusion of excluded people in the financial system. Improved effectiveness of monetary policies. Ease in tax remittance and collection to support the C ountry’s growth. Ease in targeted social interventions to support Nigerians.

3. FAQs: General Project GIANT 2 Category S/N Question Answer Genera1 What is the primary role of the CBN with respect to eNaira? In line with Section 2 of the CBN Act 2007, the CBN is the issuing authority of all forms of Naira. The Central bank will also be responsible for determining the technical, regulatory and operational standards for eNaira, to guide financial institutions. 8. Will eNaira replace cash? No, it will circulate alongside cash . The eNaira will complement cash as a less costly, more efficient, generally accepted, safe , and trusted means of payment. 9. Is eNaira safe? eNaira is safe and secured with cryptographic techniques against counterfeiting, cloning, and other forms of attack. 10. As an eNaira holder, am I assured of data privacy? Yes. Similar to the privacy enjoyed by current online banking patrons, the eNaira system has been designed to ensure data and user privacy. There are also operational policies and procedures in place to protect users’ identity and privacy. 11. Who can access eNaira? Similar to cash, any person or business can have access to eNaira as long as they have the requirements for onboarding.

4. FAQs: General Project GIANT 3 Category S/N Question Answer General 12. What is the exchange rate between eNaira and physical n aira? The eNaira will have the same value as the physical n aira. As such, it will be exchanged one to one. 13. What is the role of FIs in eNaira payment framework? The role of FIs in the eNaira ecosystem would include: Facilitate eNaira wallet onboarding for bank customers (i.e. consumers and merchants). Provide customer support services. Serve as a distributor of eNaira . Develop updated reporting and internal compliance frameworks. Ensure compliance with AML/CFT requirements. 14. Will FIs host the ewallets holding the eNaira? No, the eNaira wallets are hosted and managed on a permissioned distributed ledger . 15. What is the value proposition of eNaira to FIs? Cost efficient payment system with the opportunity for better margins with minimal cost of acquisition. Opportunity to grow lending to the retail sector. Drive for innovation and overall efficiency in operations. Drive reduction in cost of acquisition of agent as the pool of potential agents will grow exponentially. 16. How do I access eNaira ? Customers will be able to access eNaira via the eNaira wallet in app stores such as Google Play store and the Apple App store. Users can also dial a USSD short code and follow the required steps to perform transactions.

5. FAQs: General, FI Onboarding and Customer & Merchant Onboarding Project GIANT 4 Category S/N Question Answer General 17. Does eNaira earn interest? eNaira is not interest bearing. 18. What is the eNaira operating model? The eNaira operating model is a two-tiered CBDC model with the CBN issuing the eNaira and FIs distributing the eNaira to end-users. 19. Will this system be decentralised such that other providers can create their own schemes or wallet platforms? The e-wallets that hold the eNaira will be held centra lly on the distributed l edger w hile SDKs will be provided for FIs to integrate the wallet feature into their digital banking channels. FI Onboarding 20. How will FIs onboard on the eNaira system? Onboarding guidelines for FIs will be issued and communicated by the CBN. 21. How will FIs access eNaira ? FIs will get the eNaira through well defined processes outlined and communicated by the CBN. Customer and Merchant Onboarding 22. How do I access eNaira ? Customers will be able to access eNaira via the eNaira wallet in app stores such as Google Play store and the Apple App store. Users can also dial a USSD short code and follow the required steps to perform transactions.

6. FAQs: Customer & Merchant Onboarding (Cont ’d) Project GIANT 4 Category S/N Question Answer Customer and Merchant Onboarding 23. How are eNaira wallet s created? For smart phone users, download the eNaira app (termed “Speed”) from either the Google Play Store or Apple Store and complete the registration process. For feature phone users, utilize USSD codes and follow the registration prompts. 24. How do I connect my eNaira wallet to my bank account? The eNaira app allows customers to identify a bank of their choice, connect to their bank accounts and perform transactions.

7. FAQs: Customer & Merchant Onboarding (cont’d) Project GIANT 5 Category S/N Question Answer Customer and Merchant Onboarding 25. What are the different tiers and corresponding limits for individual e-wallets? These are different tiers of wallets and they include: 26. How do merchants / corporates open eNaira wallets? To create an eNaira wallet, a merchant/corporate will be required to complete the following steps: Visit the Google Play Store or Apple Store to download the eNaira wallet; Register by providing Taxpayer Identification Number (TIN) and other details; Upon completion, a reference number will be generated, which merchant/corporate will present to the preferred bank partner (with whom a previous relationship exists) to complete the registration process; The registration would be reviewed on th e eNaira Digital Currency Management System (DCMS) and in line with your company’s account mandate; Registration is approved and wallet is created and activated; FI sends wallet details to the merchant. Tiers Category Requirement Daily Limit Cumulative Limit No Existing Bank Account NIN verified telephone number 20,000 120,000 1 No Existing Bank Account 50,000 300,000 2 Has an Existing Account BVN + Valid means of ID 200,000 500,000 3 Has an Existing Account Tier 2 requirement + Public Utility Receipt 500,000 5,000,000 *Tiers 1 and 2 are not part of the phase 1 of the eNaira project

8. FAQs: Customer & Merchant Onboarding (cont’d) Project GIANT 6 Category S/N Question Answer Customer and Merchant Onboarding 27. What are the different tiers of e-wallets that can be opened for corporates / merchants? M erchants/ corporates can open merchant walle t s. The stipulated limit on the wallet will be as follows: The Limit on send is for P2P or B2B. There is no limit for SWEEP transactions from merchant wallets to merchant bank accounts. 28. Will customers be able to onboard via USSD? Yes, customers will able to onboard via USSD. This onboarding channel is available to the unbanked and would require them dialing the USSD short code; After dialing the short code, users will be required to accept the terms and conditions; Thereafter, users will be prompted to create a 6 digit wallet PIN; If successful, the user will receive a successful notification with their wallet number. Daily Transaction Limit Daily Cumulative Balance Send Receive 1,000,000 No Limit No Limit

9. FAQs: Transactions & Charges and Making Payments with eNaira Project GIANT 7 Category S/N Question Answer Transactions, Charges and Commission 29. What are the transactions that can be performed with eNaira, the charges and the commission to be earned by FIs? Making Payments with eNaira 30. How will customers get eNaira ? The flow below is to guide user experience design for FIs integrating the eNaira SDK into the digital banking channel: Users interested in getting eNaira from FIs will initiate a request by providing the eNaira amount and selecting the account to be debited; The request will be processed by FIs debiting the customer’s account and then transferring the eNaira equivalent to the customer’s wallet .

10. FAQs: Making Payments with eNaira (cont’d), Settlement & Disputes, System Integration and Integration Project GIANT 8 Category S/N Question Answer Making Payments with eNaira 31 Will FIs be required to pass system entries for transactions on the customers ’ eNaira wallet? The eNaira API and documentation have been shared and will provide guidance on the system processes for transaction flows. Settlement and Disputes 32 What is the settlement process for eNaira and what are the requirements for FIs? A core aspect of the eNaira CBDC system is transaction finality. As such, all transactions with eNaira are settled instantly on CBN's eNaira ledger. Banks have no clearing or settlement obligations to fulfil. 33 What is the role of FIs with respect to eNaira dispute resolution? This support will be limited to customers that selected the bank as their preferred banking partner during onboarding. This is because banks will only have visibility on such customers. FIs should refer to CBN consumer protection guidelines to guide their dispute resolution mechanism. System Integration 34 What are the eNaira system integration requirements? The eNaira SDK, API and documentation shared by the CBN. 35 Will there be a holistic integration of the eNaira platform with NIBSS, NCC, Telco's, NIMC databases to facilitate user verification? The eNaira platform will leverage the country's existing payment infrastructure and will be integrated to NIBSS, NIMC, etc to facilitate user verification. Reporting 36. How will FIs capture the eNaira on their balance sheets for the year 2021? The e Naira is a liability on the CBN and will be captured in its books. FIs will not have customer e Naira holdings captured in their books.

11. FAQs: Risk & Data Governance, Security and Information Project GIANT 9 Category S/N Question Answer Risk & Data Governance 37. Who takes responsibility for financial loss arising from the eNaira system? In accordance with established guidelines, in the event of fraud, FIs will be required to carry out detailed investigations. Based on the outcome, a report should be submitted to the CBN to determine the next line of action with regards to who bears the liability of financial loss. 38. Will FIs be given access to customer data? FIs will have visibility on customers who have selected them as their preferred banking partner at onboarding. Data shared with FIs will be in accordance with the Nigeria Data Protection Regulation 2019 and other relevant Nigerian laws. 39. Who is responsible for data governance on the eNaira system? CBN will be responsible for data governance on the eNaira system. Security 40. Who will be responsible for the security of the eNaira payment system? The CBN, its technical partners and NIBSS will provide IT security governance . FIs will be required to maintain the security standards as defined by the CBN with respect to their digital banking channels. In addition, a two factor authentication system and cryptographic encryption ha s been enforced on the eNaira to ensure the safety of customers wallet and the eNaira holdings. Information 41. Are there documents or training materials for FIs on eNaira solution? Yes. The CBN has developed a suite of educational and information materials for FIs. Additionally, the CBN would organise training and capacity development sessions on eNaira for staff of FIs. Details will be communi cated to the FIs via the usual means.

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