Nigeria Leads China in PwC’s Retail CBDC Index

China may have been considered the first major economy to pilot a central bank digital currency (CBDC) in 2020 with its digital yuan (e-CNY), it is not leading the retail CBDC index according to the top consulting and accounting firm, PwC. 

In the latest PwC 2022 CBDC Global Index, the firm puts China behind Nigeria and The Bahamas on the list of the top 10 retail CBDC projects despite the Asian country having moved higher in its ranking score from 75 in 2021 to 87 this year. On the other hand, Nigeria has a score of 95 even though the first African country to launch a CBDC is a new entrant on the top 10 list. 

Retail CBDC projects are digital currencies designed for public use. They differ from wholesale projects which are those used by financial institutions that have accounts with central banks. PwC notes in the index, which ranked central banks that are in the lead on CBDC projects, that retail CBDCs have reached greater maturity levels than wholesale projects.

The firm analyzed individual countries’ CBDC projects based on the three key indicators introduced by the Bank for International Settlement – CBDC projects’ status, central banks’ speech, and the public interest proxy like their scores on search engines such as Google and Baidu.

Only the transactional data of the e-CNY and Nigeria’s e-Naira has been made available, the report states. It points out that a key differential is seen in Nigeria’s wide coverage area for its CBDC and the approximately 160 countries where the e-Naira app was downloaded from.

Meanwhile, China has more than 261 million wallets and about $14 billion in total transactions so far. Also, from its app launch to its use during the 2022 Beijing Olympics, other ways China has been big on the e-CNY in the past year include the pilot programs being run in 12 cities including Beijing and Shanghai as of March 2022, PwC notes.

According to William Gee, a partner at PwC Mainland China and Hong Kong SAR, the participation of citizens in the ongoing pilot across the 12 cities made the phase “by far the largest digital fiat initiative in the world.” 

Relatedly, the e-CNY entered its third round of testing this week after the People’s Bank of China released the list of new regions for CBDC’s trials on Saturday, April 2. The regions include Tianjin, Chongqing, and Guangzhou in the Guangdong province and some experts believe that additional tests are required for the digital currency to gain wider use.

Aside from the pilot tests, China is also a part of the m-CBDC Bridge (or mBridge) project which seeks “to improve wholesale cross-border payments with a streamlined intermediation model, real-time transfers, and atomic Payment-versus-Payment (PvP) settlements”.

It joined the mBridge multicurrency CBDC platform last year as one of the participating central banks that want to analyze business use cases with CBDCs such as international trade settlement and capital market transactions. The PwC report highlights that the mBridge initiative, launched by the Hong Kong Monetary Authority and the Bank of Thailand, made Hong Kong and Thailand’s CBDC projects stand out in the top 10 wholesale CBDC index.