Fintech introduce N50 fee on large transfer

Leading Nigerian fintech companies in Nigeria have announced the introduction of a N50 fee on electronic money transfers exceeding N10,000, in line with Federal Inland Revenue Service (FIRS) regulations.

The new charge will take effect on September 9, 2024, and will apply to both personal and business accounts.

The companies informed their customers of this development through a notice titled “FGN Electronic Money Transfer Levy,” which started circulating on Saturday. The message stated, “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.”

The firms said that the N50 fee is not a source of profit for the companies, as it is entirely directed to the Federal Government. The fee is a one-time charge for each eligible transfer, as mandated by the government’s directive.

This move follows the enforcement of the Electronic Money Transfer Levy (EMTL), a tax introduced by the Nigerian government under the Finance Act 2020.

The EMTL imposes a fixed levy of N50 on electronic receipts or transfers of funds to generate revenue for the government’s fiscal needs. The levy applies to all transactions processed through any money transfer or payment system for amounts of N10,000 or more.

The implementation of this levy is part of a broader strategy by the Nigerian government to diversify its revenue sources, particularly in light of increasing financial demands for public services and infrastructure projects.

In recent years, many Nigerians and business owners have turned to neobanks due to their reliability, lower transaction decline rates, and prompt reversal of failed transactions.

These fintech platforms have gained popularity for their low transaction fees, offering much-needed relief during recent economic challenges, including a cash crunch.