The Federal Government now enforces the Electronic Money Transfer Levy (EMTL), charging a N50 fee on electronic transfers of N10,000 and above. This policy, which started on December 1, 2024, affects financial platforms like Opay, Moniepoint, and Kuda. Many Nigerians are concerned about its economic implications, especially as household budgets remain strained.
What Is the Electronic Money Transfer Levy?
The Electronic Money Transfer Levy charges N50 on every inflow of N10,000 or more. The government introduced this policy through the Finance Act 2020 to generate additional revenue.
Key Details About the Levy
- Who Pays?
The recipient of the transfer is responsible for the fee. - Where Does It Apply?
This levy applies to all financial platforms, including popular fintech apps. - Revenue Allocation
The Federal Inland Revenue Service (FIRS) collects these funds to support government initiatives.
Why Did the Government Introduce This Levy?
The government relies on the Electronic Money Transfer Levy to increase revenue from Nigeria’s rapidly expanding digital economy. Cashless transactions in the country exceeded N600 trillion in 2023, presenting an opportunity to capitalize on this growth.
Transitioning to a Cashless Economy
To maintain transparency and accountability, the FIRS requires financial institutions and fintech companies to deduct and remit the levy promptly.
Public Reactions to the Policy
The levy has drawn criticism from various sectors of society. Advocacy groups like the National Association of Nigerian Students (NANS) believe it unfairly burdens citizens already struggling with economic pressures.
Common Concerns
- Rising Costs: Many Nigerians worry about how this fee adds to the cost of daily transactions.
- Limited Relief: Critics argue that the government should prioritize policies that ease economic hardship instead of imposing more levies.
Fintech Platforms Respond to the Policy
Fintech platforms such as Opay and Moniepoint have issued notices to users about the new levy. They emphasize that the funds go directly to the FIRS.
- Opay: “This charge complies with government regulations and is remitted to the Federal Inland Revenue Service.”
- Moniepoint: “Customers will pay N50 on every inflow of N10,000 or more. We remit these funds on behalf of the government.”
Adapting to the Changes
This policy compels Nigerians to adjust their financial planning. The additional cost of transfers affects household budgets, especially during challenging economic times.
Potential Long-Term Effects
The government expects the levy to encourage accountability and generate significant revenue. However, its success depends on whether it enhances public trust or exacerbates dissatisfaction.
The Electronic Money Transfer Levy highlights the government’s focus on revenue generation through digital transactions. Although it supports national goals, public criticism underscores the need for policies that balance fiscal responsibility with economic relief.