FG earns N80.86 billion from electronic transfer levy in 6 months

The Nigerian government earned N80.86 billion from Electronic Transfer Levy in the first six months of 2023.

Electronic Transfer Levy replaces Stamp Duty and deducts from every electronic deposit of N10,000 and above.

The information is according to Data from the Federal Account Allocation Committee.

The Electronic Transfer Levy was introduced as a source of additional revenue for the government in the 2020 Finance Act, amending the Stamp Duty Act to harness the growth of electronic funds transfer in the country.

The EMT is a single and one-off charge of N50 on electronic receipt or transfer of money deposited in any money deposit bank, financial institution, or account in amounts of N10,000 and above.

The EMTL has remained a steady source of income for the federal, state, and local governments.

In January 2023, the EMTL generated N13.8 billion, N11.65 billion for February, N14.49 billion in March, N15.12 billion in April, N14.37 billion in May, and N11.44 billion in June.

In its 2023-2025 Medium Term Expenditure Framework and Fiscal Strategy Paper, the Budget Office hoped to earn N137.03 billion from EMT in 2023, N157.59 billion in 2024, and N187 billion in 2025.

The Budge Office said: “The Main Pool, VAT Pool, and Electronic Money Transfer Levy are projected at N4.89 trillion, N2.74 trillion, and N136.35 billion, respectively, in 2023.”

It also stated that the government made about N111.84 billion from EMTL in 2021. Nigeria experiences surge in electronic transfer Electronic payment has witnessed a surge in adoption since the COVID-19 pandemic hit in 2020.

Data from the Nigeria Inter-Bank Settlement System reveal that the total value of electronic transactions was 108.42 trillion in 2019.

The amount grew to N162.89 trillion and surged to N278.38 trillion in 2021. By 2022, cashless transactions skyrocketed to N395.47 trillion.

Per a statement from the International Monetary Fund (IMF), the value of mobile money transactions in Nigeria spiked to 9.72% of the Gross Domestic Product (GDP) in 2020 due to the COVID-19 pandemic.

Legit.ng reported that the Nigerian Inter-Bank Settlement System (NIBBS) has reduced its transaction processing fee for NIBBS Instant Payment from N5 to N3.75k.

In a letter dated May 31, 2023, addressed to payment solution service providers, NIBSS stated that it was cutting its fees to drive financial inclusion and support innovation in the country.

The Punch reports that the document, which was signed by NIBBS Executive Officer Premier Oiwoh and the Executive Director of Business Development Ngover Ihyember-Nwankwo, stated that the management of Nigeria Interbank Settlement System had approved a further reduction on NIBBS Instant Payment from N5 to N3,75k effective July 1, 2023.