The Federal Government has officially rolled out its N50 electronic levy on transactions of N10,000 and above from financial technology (Fintech) platforms, starting from December 1, 2024.
This new policy, the Electronic Money Transfer Levy (EMTL), is part of the Finance Act 2020. It imposes a one-time N50 charge on recipients of electronic transfers of N10,000 or more.
According to the Federal Inland Revenue Service (FIRS), the levy was meant to take effect from September 9, 2024, but has only now been implemented.
The move is already causing a stir among Nigerians, especially users of platforms like Opay, Moniepoint, and Kuda, who have begun seeing deductions from their accounts.
A Drastic Step
The new levy, though small in amount, has drawn heavy criticism from many quarters. The National Association of Nigerian Students (NANS) is one of the groups that have opposed the government’s decision
Despite these concerns, the government remains firm in its position. According to a statement from Opay, the N50 charge is not a decision made by the platform itself. Instead, it was mandated by the FIRS and is being enforced by the company.
“Please be informed that starting September 9, 2024, a one-time of N50 will be applied to electronic transfers of N10,000 and above paid into your personal or business account in compliance with the Federal Inland Revenue Service (FIRS) regulations,” Opay said in an earlier notice. “It is important to note that Opay does not benefit from this charge in any way as it is directed entirely by the federal government.”
Financial Technology Firms’ Role
Fintech platforms like Opay, Moniepoint, and Kuda, which are responsible for processing these transactions, have now begun deducting the levy from customer accounts.
Opay officially informed its users on December 1 that the EMTL charge was now active. “Dear Customer, in line with the FIRS, the EMTL applies starting from December 1st, 2024,” the message read.
Similarly, Moniepoint, another popular fintech platform, also sent out notifications to its users, confirming the commencement of the N50 deductions.
“Dear customer, you will be charged stamp duty of N50 on inflows of N10,000 and above. Moniepoint collects and remits this on behalf and to FIRS,” the message from Moniepoint read.
While these charges are a relatively small amount, they represent an extra cost for Nigerians who have become accustomed to using fintech platforms for daily transactions.
Growing Concerns and Discontent
For many users, the levy raises concerns about the increasing number of taxes and charges being placed on digital transactions. With many fintech platforms offering low-cost financial services, the new levy may be seen as an additional burden, especially for the working class and young Nigerians who depend on these platforms for both personal and business purposes.
For others, the levy represents another way for the government to generate revenue, especially at a time when fiscal challenges are mounting.
What’s Next?
Despite the backlash, the federal government appears determined to move forward with the policy. The implementation of the N50 levy is a step towards increasing revenue through non-oil sources, as the country seeks to diversify its income base.
With the approval of the Finance Act in 2020, the government anticipated that such measures would be necessary to meet its revenue targets and reduce dependence on oil exports.
However, the success of the N50 EMTL levy will depend largely on how Nigerians react to the new charges. Whether the policy will face further resistance or gain acceptance remains to be seen.
