Nigerian bank customers have collectively contributed ₦133.89 billion in electronic money transfer levies (EMTL) to the government between January and August this year.
This figure was the revenue generated from the ₦50 levy applied to electronic transfers of ₦10,000 and above.
The EMTL, introduced under the Finance Act of 2020, aims to promote the use of electronic funds transfers while bolstering government revenue.
The revenue derived is distributed across the three tiers of government: the Federal Government receives 15%, state governments 50%, and local governments 35%.
According to the 2025-2027 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP), the sum collected so far accounts for 76% of the ₦175.11 billion target set in the 2024 budget. This reveals the importance of EMTL as a reliable source of public revenue.
Expansion to Fintech Platforms
The government plans to increase revenue from Electronic Money Transfer Levies by expanding its scope to include transactions on financial technology (fintech) platforms. By 2025, projections show that EMTL collections could rise to ₦228.85 billion, a 31% increase from the 2024 target.
Fintech companies such as OPay, PalmPay, and Moniepoint recently began deducting the ₦50 levy on transfers above ₦10,000, in compliance with directives from the Federal Inland Revenue Service (FIRS).
Although the original implementation date was set for September, enforcement began on 1 December 2024. This was the end of free transfer services previously offered by these platforms, as they now remit the charges directly to the federal government.
Understanding the EMTL
The levy applies as a one-time charge on eligible transfers conducted through banks and licensed financial institutions. However, there are some exemptions, including:
- Transfers below ₦10,000.
- Funds deposited into the payer’s account.
- Transfers between accounts owned by the same individual within the same bank.
Initially applied only to local currency transactions, the FIRS extended the levy to cover foreign currency transfers in December 2023. In compliance, banks began deducting the charge retroactively on foreign currency transactions from 2021 to 2023.
While the levy bolsters government revenue, it also has an impact on citizens, particularly with the introduction of charges by fintech platforms.
The end of free banking services, once a competitive edge for fintechs, increases the cost burden on customers who rely on these platforms for convenience and accessibility.
