Africa Stablecoin Network backs CBN on payment overhaul
The Africa Stablecoin Network backs CBN on payment overhaul, aligning with calls by the Central Bank of Nigeria to modernise cross-border transactions and reduce the structural inefficiencies that continue to weigh on developing economies.
The endorsement follows remarks by Olayemi Cardoso, Governor of the Central Bank of Nigeria, who raised concerns over the high cost and slow pace of international payments during the Intergovernmental Group of Twenty-Four Technical Group Meeting.
Cardoso observed that cross-border remittances remain burdened by settlement delays, compliance bottlenecks and transaction charges averaging over six per cent globally.
For small businesses and migrant workers, these frictions translate into lost income and restricted access to global markets.
In response, the Africa Stablecoin Network (ASN) said it shares the regulator’s objective of building faster, more inclusive and cost-efficient payment systems. However, the group argued that digital assets—particularly stablecoins—could play a catalytic role if supported by a clear and harmonised regulatory framework.
Stablecoins as infrastructure, not speculation
President of the Africa Stablecoin Network, Nathaniel Luz, described stablecoins as a practical solution to Africa’s structural payment challenges rather than speculative instruments.
“While stablecoins may be viewed as optional tools in advanced economies, in Africa they address real constraints in trade settlement and remittance flows,” Luz said.
He noted that under traditional correspondent banking systems, cross-border transfers can take between two and five days to settle. By contrast, blockchain-based settlement rails could complete equivalent transactions within minutes, drastically improving liquidity cycles for micro, small and medium enterprises.
The Africa Stablecoin Network backs CBN on payment overhaul partly because of these efficiency gains. According to ASN estimates, remittance charges currently ranging between five and seven per cent could fall below one per cent if supported by regulated digital payment infrastructure.
Regulatory clarity as the missing link
While endorsing innovation, the Central Bank has consistently raised concerns about currency substitution risks, foreign exchange volatility and financial stability implications. ASN acknowledged these risks but argued that robust oversight—not prohibition—offers the most sustainable path forward.
The network pointed to the Investment and Securities Act 2025, which empowers the Securities and Exchange Commission Nigeria to supervise digital assets. The Act is seen as a critical milestone in providing statutory clarity for crypto-linked instruments, including stablecoins.
ASN also referenced the remarks of SEC Director-General Emomotimi Agama at the Nigeria Stablecoin Summit 1.0, where he stated that Nigeria is open to stablecoin innovation under regulatory safeguards that protect markets and empower citizens.
The Africa Stablecoin Network backs CBN on payment overhaul by advocating coordinated engagement between the apex bank and the SEC. According to the group, alignment between monetary authorities and capital market regulators would ensure systemic oversight without stifling innovation.
Alignment with Payments System Vision 2025
ASN further highlighted the CBN’s Payments System Vision 2025 as a framework capable of accommodating emerging financial technologies.
The strategy outlines objectives around financial inclusion, interoperability and secure digital transactions—goals that overlap with stablecoin deployment.
By embedding stablecoins within a regulated environment, the network argues that Nigeria could formalise informal value flows, enhance transaction transparency and improve compliance monitoring.
“When stablecoins operate within a defined Nigerian regulatory perimeter, value flows become traceable and more economic activity enters the formal system,” Luz stated.
The Africa Stablecoin Network backs CBN on payment overhaul on the premise that coordination across agencies—rather than fragmented oversight—will determine whether Nigeria captures the benefits of digital finance.
Implications for intra-African trade
The debate extends beyond remittances. Under the African Continental Free Trade Area, faster settlement systems could unlock smoother trade corridors across the continent. SMEs, often excluded from complex correspondent banking networks, stand to benefit from simplified payment rails.
Lower transaction costs can improve supplier payments, reduce working capital constraints and expand market participation. Intra-African trade, currently constrained by logistical and financial inefficiencies, could gain traction if settlement barriers are reduced.
Analysts note that regulatory experimentation through sandbox environments may provide a pathway to test stablecoin frameworks without exposing the broader financial system to undue risk.
Safeguarding monetary sovereignty
Critics argue that widespread adoption of dollar-pegged stablecoins could undermine local currencies. ASN countered that the absence of regulation poses a greater threat than supervised integration.
“The real risk lies in exclusion from shaping the future of money,” Luz said, suggesting that delayed engagement could leave Nigeria reactive rather than proactive in digital finance governance.
The Africa Stablecoin Network backs CBN on payment overhaul with a call for unified strategy involving the CBN, SEC, Nigerian Financial Intelligence Unit and Nigeria Data Protection Commission. Such coordination, the group believes, would balance innovation with macroeconomic stability.
As digital payments reshape global finance, Nigeria faces a strategic choice between cautious observation and structured participation. The convergence of regulatory reforms, legislative backing and payment modernisation initiatives presents a window of opportunity.
If policymakers harmonise oversight mechanisms while encouraging responsible innovation, Nigeria could strengthen its cross-border competitiveness and enhance financial inclusion.
For now, the Africa Stablecoin Network backs CBN on payment overhaul as a signal that segments of the fintech ecosystem are ready to collaborate with regulators.
Whether that collaboration yields a comprehensive national digital payments architecture will depend on policy clarity, institutional coordination and sustained stakeholder dialogue.
