Emefiele calls for increased application of digitisation, accelerated growth

GOVERNOR of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, has called on members of the Monetary Policy Committee (MPC) to come up with new ways of adapting monetary policy tools to improve the contribution of digital technology and innovations to economic growth.

While making this call at the MPC retreat organised by the apex bank in Lagos over the weekend with the theme, ‘Monetary Policy Implementation in a Digitally evolving Developing Economy,’ Emefiele explained that the purpose of the retreat was to appraise the performance of monetary policy in the last four years as well as brainstorm on new methods of addressing the increasing challenges of confronting monetary policy formulation and implementation in Nigeria.

Emefiele added that digital financial services are reputed to have created 95 million job opportunities and boosted the GDP of emerging economies by six per cent.

According to him, there is near consensus on the potential of digital finance in boosting growth performance by facilitating the interconnectedness of agents in economic activities, access to a diverse range of financial products and credit facilities for individuals and small, medium, and large enterprises.

The Central Bank of Nigeria, he added, has championed the financial inclusion principle to achieve the SDGs, including the recent launch of the eNaira (CBDC) to capture the large unbanked populace into the formal sectors and also improve monetary policy efficiency and positive impact on the better standard of living for the population.

Noting that one of this challenges is the explosion and increased acceptability of digital innovations, Emefiele said, “The evolution of FinTechs, cryptocurrencies, digital payments, Artificial Intelligence and Machine Learning, have changed the functioning of the financial and banking sectors, both globally and domestically.

“Therefore the urgent call for the need to rethink financial system regulation, supervision and monetary policy implementation. While the innovations come with a lot of risks and uncertainties for the sectors, they also have many benefits for positive economic transformation and particularly, financial inclusion which has been the principal catalyst for inclusive growth, poverty reduction and employment generation.”

Highlighting the positive impact of digital technology on economic growth, the CBN boss said, “While post-COVID growth recovery in Nigeria can be adjudged to be moderate and stable, we have seen a major change in the key sectoral drivers of that stable growth phenomenon, including the services sector, modernised agriculture, and manufacturing, suggesting that technology and innovation is playing a major role in output growth and economic development in Nigeria.

“Hence the need to explore new ways of adapting monetary policy tools to improve the contribution of technology and innovations to the growth equation.”

Speaking further while interacting with the media on the sidelines of the retreat on the expected outcome and impact of the august gathering, Emefiele said, “We have seen what is happening in the global economy and we are going to be addressing those issues and see if we can chart a new course and what next we should do in the coming years to see to it that we provide monetary policy direction for the Nigerian economy.

“So, we would be expecting new ideas, new strategies on monetary policy in a digitised global economy, what we are going to be doing in light of the challenges posed by fintech, cryptocurrencies agents globally and what direction to take.

“I can assure you that after this meeting, we would see a new improved monetary policy and a new and improved CBN that would provide direction for monetary policy in Nigeria.”