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Fintech firms, including OPay, Moniepoint, and others, have begun informing their clientele that, as of September 9, they will start deducting N50 for the Electronic Money Transfer Levy (EMTL) from each and every input of N10,000 or more.
The deduction is in compliance with the Federal Inland Revenue Service (FIRS) directive, as stated by the fintech companies. Even though the fees go to the federal government, some fintechs offer free banking services as a result of this mandated reduction.
Customer message
Moniepoint sent out a brief notification on Saturday to its clientele, which stated: “An N50 fee would be charged on inflows you receive of N10,000 and above from Monday, September 9, 2024. Your BRM is available to answer questions you might have.”
OPay, for its part, informed its customers that the deduction is intended for EMTL following federal directives.
Opay disclosed this to his customers: “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 the Federal Inland Revenue Service (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,” they added.
The EMTL, which was formerly limited to commercial banks, is now applicable to all fintech companies, including Paga and Palmpay, among others.
Continuing, the federal government’s efforts to increase taxes and levies to boost its revenue may have something to do with this prolongation.
It is convenient to be aware that electronic money transfers or receipts in Nigeria are subject to a one-time N50 tax known as the Electronic Money Transfer Levy (EMTL), BrandSpur banking and finance news reports.
With the following exceptions, it covers any electronic fund transfers made within a bank or financial institution operating under a Nigerian licence:
Transactions under N10,000
Cash deposited into a personal account
Electronic funds transfers between the same owner’s accounts at the same bank
The Finance Act 2020 included the EMTL to promote the expansion of electronic fund transfers in Nigeria.
The three levels of government split the EMTL’s revenue. The federal government receives 15% of the EMTL revenue, state and local governments receive 50%, and the federal government receives 35%. This distribution of revenue is based on derivation.
Additionally, deposit banks were instructed by the FIRS in December of last year to deduct and remit the EMTL on future foreign currency (FCY) transactions.
Before then, local currency transactions were the only ones subject to the N50 fee on transactions above N10,000. As instructed by the tax regulator, the banks started deducting EMTL on old foreign currency transactions in January of this year for transactions spanning from 2021 to 2023.
