According to data obtained from the Federation Account Allocation Committee communique for January to June 2023, electronic transfer levies have proven to be a significant revenue source, generating N80.86bn for the three tiers of the Nigerian government in the first six months of 2023. This surge in revenue follows a notable increase in electronic transfers recorded in the country in recent times.
The introduction of the electronic money transfer levy as a government revenue source in the Finance Act 2020, which amended the Stamp Duty Act to leverage the growth of electronic funds transfer in Nigeria, has proven to be a steady source of income since its implementation.
The EMT levy, a one-off charge of N50 on electronic receipt or transfer of money deposited in any deposit money bank or financial institution on sums of N10,000 or more, has been responsible for generating substantial revenue. The government earned N13.8bn from electronic money transfer levies in January, N11.65bn in February, N14.49bn in March, N15.12bn in April 2023, N14.37bn in May, and N11.44bn in June.
Notably, the government is on track to surpass its projected earnings for 2023. In its 2023 – 2025 Medium Term Expenditure Framework and Fiscal Strategy Paper, the Budget Office of the Federation had aimed to make N137.03bn from EMTL in 2023, N157.59bn in 2024, and N189.11bn in 2025.
The significant growth in electronic transactions can be attributed to the surge in adoption of e-payment transactions since the onset of the pandemic in 2020. Data from the Nigeria Inter-Bank Settlement System portal indicates that the total value of electronic transactions increased from N108.42tn in 2019 to N278.38tn in 2021, with cashless transactions jumping to N395.47tn in 2022.
Furthermore, the International Monetary Fund reported that the value of mobile money transactions in Nigeria reached 9.72 per cent of the Gross Domestic Product in 2020 due to the impact of the COVID-19 pandemic.
In light of these trends, experts predict that the Electronic Money Transfer Levy will continue to grow in the foreseeable future. Victor Olojo, the National President of the Association of Mobile Money Agents in Nigeria, stated that the levy’s upward trajectory is likely to persist, further contributing to government revenue in the coming years.
