Nigerians who have already resorted to desperate measures to cushion the effects of difficult socio-economic conditions, are increasingly worried about what they describe as multiple bank charges especially stamp duty at a time when inflation has affected the purchasing power of the naira.

President Bola Tinubu on Wednesday penultimate week, admitted that Nigerians are currently going through tough times due to his administration’s decision to remove fuel subsidy and converge the foreign exchange rate.

However, a herd of bank customers who spoke to Nigerian Tribune said the rate at which their monies are being deducted at every bank transaction in the bank is becoming unbearable as it gradually eats deep into household disposable incomes.

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Some of the most regular charges which often come in multiples are: Commissions, Value Added Tax, Telco charges, Stamp duty, Transfer charges among others.

A bank customer, Mr. Damian Nnanyerugo, lamented that the most ridiculous part is that the federal, state and local governments take part in sharing part of these deductions in form of Electronic Money Transfer Levy (EMTL).

Indeed, checks reveal that a revenue of N14.102 billion Electronic Money Transfer Levy (EMTL) was part of FAAC distributable revenues out of the total of N1.1 trillion revenue shared in August 2023 by the Federation Account Allocation Committee (FAAC).

The federation’s account disbursement in October was also supported by increases of 45percent m/m and 14 percent m/m in electronic money transfer fees and value-added-tax to N16 billion and N324billion, respectively.

The Federal Government is set to make a total of N483.73billion in three years from electronic payment boom by way of the Electronic Money Transfer Levy.

This projection was made by the Budget Office of the Federation and revealed in its 2023 – 2025 Medium Term Expenditure Framework and Fiscal Strategy Paper.

The EMTL was introduced in the Finance Act 2020, which amended the Stamp Duty Act to tap into the growth of electronic funds transfer in the nation.

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

Revenue derived from the EMTL is shared among the three tiers of government.

According to the budget office, which is under the Ministry of Finance, Budget and National Planning, the nation intends to make at least N137.03bn in 2023, N157.59bn in 2024, and N189.11bn from EMTL

Another Bank customer, Sufyan Adam took to the social media to express his frustration.

“Dear Central Bank of Nigeria @cenbank, despite the hard economic & the so many harsh economic policies by you, what is this N50 stamp duty charges on every credit of N10,000 & above?

“Do you want to push us deeper into hardship & poverty? This anti-People’s policy must stop, “Adam stated.

Another Bank customer, Yinka Ogunnubi, differed in his opinion. He admitted that like Ghana did, Nigeria gives a free threshold of N10,000 per transaction, but the difference is clear; “while Ghana (with total volumes of 77million transactions 2020) charges 1.5percent, Nigeria (with volumes of 3.4 billion 2021) charges a flat fee of N50.00 regardless of value.

“Imagine how much Nigeria will make in tax revenue if we should toe the same line as Ghana? Imagine what our tax to GDP will be if the govt was more aggressive in ‘expanding the tax net’ like Ghana did? Imagine what Ghanaians will give to replace their eLevy with Nigeria’s EMT Levy?

“I am not predicting that the Nigerian govt will toe the same line as Ghana, but I won’t be surprised if they’re keeping a close tab at implementation to see how it goes. One thing is sure, taxing the digital economy is where a lot of govt will look to raise additional revenue, “Ogunnubi stated.

Not too long ago, the Nigerian Inter-Bank Settlement System (NIBSS), Nigeria’s largest payment infrastructure, reduced the processing fee for transactions on its platform.

NIBSS reduced the processing fee for transactions on NIBSS Instant Payment (NIP). The new ₦3.75 pricing for instant transfers—down from ₦5—took effect on July 1, 2023.

Sources said the reduction resulted from commercial banks asking for a reduction in the cost of transactions, adding that the reduction will not affect the transaction fees banks charge their customers.

In December 2019, the CBN, in a move to offer stability and improve financial inclusion, compelled banks to reduce their fees. Some banks hesitated due to concerns over their profit margins. Their hesitance was met with fines.

TechCable quoted Charles Odogwu, the growth head for NowNow, as having said that if banks lower transaction fees, it can “stimulate increased transaction volume”. He added that this could translate into more revenue opportunities for banks, “especially if they have a significant market share in electronic payment services”.

On the flip side, he said that reducing transaction fees may impact banks’ profit margins. “If the price reduction is significant, banks may experience a decline in transaction fee revenue, which could affect their overall profitability”, Odogwu said.

Meanwhile, all deposit banks and financial institutions are required to charge stamp duties of N 50 on every eligible transaction above N 10,000. There are exemptions for transactions between accounts held by the same bank customer and for salary accounts.

It should be recalled that the 2020 Finance Act modified section 89(3) of the Stamp Duties Act to remove electronic transfer from the scope of stamp duty and introduced an electronic money transfer levy, which is applicable on electronic receipts or electronic transfer for money deposited in a financial institution, on any type of account. The applicable levy is N50 on any transfer of N 10,000 or more.



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