Kenya’s central bank has asked the public to share their thoughts on the possibility of adopting a digital currency by May 20th, just one day after it was revealed that Zambia is also testing its viability.

Nigeria was the first African country to launch its central bank digital currency (CBDC), dubbed the eNaira, in October last year, while Ghana is said to be nearing completion of its e-cedi launch. In addition, the Bank of Zambia is conducting research on digital currencies. CBDCs, unlike cryptocurrencies such as Bitcoin and Ethereum, are created by central banks and are pegged to national currencies.

The Central Bank of Kenya (CBK) issued this document today as the basis for a public discussion, noting that cost reduction, interoperability, and improved cross-border payments would be the primary drivers of digital currency adoption in Kenya. According to the CBK, mobile money (e-money), which was pioneered by East Africa’s largest economy in 2007, has already helped the country improve access to financial services — one of the value propositions of digital currencies.

“The trend in Kenya’s domestic payments suggests the existence of a robust, inclusive, and highly active digital currency (e-money).” As a result, given the existing and growing penetration of mobile money, the CBK believes that introducing a CBDC into Kenya’s payments system would not be primarily focused on improving access to financial services.

According to CBK data, Kenya’s 38 million mobile money subscribers transacted a total of $55 billion in the first 11 months of last year. This represents a 20% increase over the same period the previous year.

“In the future, connecting our payment systems across the region and globally will be critical.” Existing proposals suggest that CBDC has the potential to achieve this interoperability,” the CBK said.

According to the CBK, a digital currency that is compatible with others could help improve cross-border payments, which are currently slow and expensive. According to the IMF, discussions are ongoing on how CBDCs could be used for cross-border payments, but this, too, has potential risks.

“Adverse macroeconomic consequences, such as increased currency substitution and vulnerability to financial shocks, are possible as retail CBDC becomes available across borders,” the IMF stated in a paper released yesterday.

To date, nine countries have launched a digital currency, with Nigeria being the first outside the Caribbean — 14 are in the pilot stage while 87 others are exploring it.