Leading fintech companies in Nigeria, including OPay and Moniepoint, have notified their customers of plans to implement a N50 Electronic Money Transfer Levy (EMTL) on all inflows of N10,000 and above, starting from September 9, 2024. This development follows a directive from the Federal Inland Revenue Service (FIRS), signaling the end of an era of free banking services offered by these platforms for such transactions.
In a message to its customers on Saturday, Moniepoint announced: “A N50 fee will be charged on inflows you receive of N10,000 and above from Monday, September 9, 2024. Your BRM is available to answer any questions you may have.” Similarly, OPay issued a clarification, stating that the deduction is solely in compliance with the federal government’s EMTL policy.
“Please be informed that starting September 9th, 2024, a one-time fee of N50 will be applied to electronic transfers of N10,000 and above paid into your personal or business account in compliance with FIRS regulations. It is important to note that OPay does not benefit from this charge in any way, as it is directed entirely to the Federal Government,” OPay explained to its users.
The EMTL, previously applicable only to commercial banks, has now been extended to include all fintech platforms, such as Palmpay and Paga, among others. This extension is seen as part of the government’s broader efforts to increase revenue through the expansion of taxes and levies.
What is the EMTL?
The Electronic Money Transfer Levy (EMTL) is a one-time N50 charge on electronic money transfers or receipts within Nigeria. It applies to transfers made through licensed banks and financial institutions, with some exceptions:
Transfers below N10,000
Money paid into the sender’s own account
Transfers between accounts of the same owner within the same bank
The EMTL was first introduced in the Finance Act 2020 to encourage the growth of electronic fund transfers. Revenue from the levy is shared across the three tiers of government, with the Federal Government receiving 15%, state governments 50%, and local governments 35%.
Impact on Foreign Currency Transactions
In December 2023, the FIRS extended the EMTL to include foreign currency transactions, which were previously exempt. Banks began deducting the N50 charge on foreign currency transactions from as far back as 2021, following the tax regulator’s directive. Initially, the levy applied only to local currency transactions.
This latest development is expected to impact millions of fintech users across Nigeria, as platforms like OPay and Moniepoint will now comply with the mandatory deduction, further aligning with traditional banking practices.
