Nigerians paid N180.31 billion as electronic money transfer levy (EMTL) in 2023, a 29.45 percent increase from the N136.35 billion target of the government for the year.
The growth in EMTL was driven by a surge in electronic transactions, which Electronic transfers grew by 54.55 percent year-on-year to N611.06 trillion in 2023, according to data from the Nigeria Interbank Settlement System (NIBSS).
EMTL, which was introduced in the Finance Act 2020, was an amendment to the Stamp Duty Act to tap into the growth of electronic transfers in the country. It is a single, one-off charge of N50 on electronic receipt or transfer of money deposited in any deposit money bank or financial institution on any type of account on sums of N10,000 and above.
Nigerian banks began deduction of N50 electronic money transfer levy (EMTL) on foreign currency (FCY) transactions. The Federal Inland Revenue Service (FIRS) mandated commercial banks to deduct and remit the electronic money transfer levy on foreign currency transactions.
From January 2, 2024, the deduction will be extended to FCY inflows equivalent of N10,000 and above, incurring a charge of N50 (FCY equivalent).”
Revenue from EMTL is shared among the three tiers of government. In 2023, government recorded N25.33 billion from EMTL in January, N13.80 billion in February, N12.13 billion in March, N15.09bn in April, N15.12 billion in May, N14.97 billion in June, N11.91 in July, N13.37 billion in August, N14.69 billion in September, N11.45 billion in October, N16.20 billion in November, and N12.45 billion in December.
The Federal Government is now on track to achieve its target of N483.73 billion in EMTL in three years. This projection was made by the Budget Office of the Federation and revealed in the 2023-2025 Medium Term Expenditure Framework and Fiscal Strategy Paper.
The growth in EMTL revenue is expected to be fuelled by further increases in cashless transactions in the country, especially with the Central Bank of Nigeria anticipating the slowdown of cash usage in the country by 2025.
“The use of cash will naturally slow with the ‘mobile first generation’, which will be economically active by 2025, hence one of the focuses of the PSV 2025 is enhancing the cashless policy of the CBN,” the bank said in its ‘Payments Vision 2025’ document.
Victor Olojo, former national president of Association of Mobile Money Agents in Nigeria, in a post by the NIBSS, said,
“It is a huge meaningful source of revenue to them. For every transaction above N10,000 that enters your account, stamp duty is automatically deducted. It is a big win for the Federal Government.”
