By Calista Oyeoba / Posted December 9, 2024
The shocking introduction of Electronic Money Transfer Levy (EMTL) by the federal government of Nigeria (FG), amidst micro economic challenges facing many Nigerians, has sparked concerns among citizens and businesses. The EMTL imposes a N50 charge on electronic transfers above N10,000, with exemptions for transfers under N10,000 and transactions within the same financial institution.
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For Pos operators, the EMTL means increased charges, with an additional N75 extra charge on transactions to cover the levy. This could impact their profit negatively or compel them to pass the new cost on to customers.
The EMTL was introduced to align with the 2020 Finance Act and the Nigerian Stamp Duty Act. The FG highlights that it expects to generate important revenue from the levy, with projections progressively from about N230 billion in 2025, N265 billion in 2026, and N305 billion in 2027.
However, Nigerians have expressed concerns over the new levy, citing increased financial burdens and discouragement of digital payments. Fintech companies have begun implementing the EMTL charge, and some have communicated the levy to their users, stating that the charge is mandated by the government.
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The EMTL’s impact on businesses, cannot be overstated. Many small businesses which rely on fintech platforms for transactions will be adversely affected as the additional charge could either reduce their profit or force them to pass the cost on to customers and in extreme case, abandon the business.