The OPAY's Electronic Money Transfer Levy (EMTL) is a tax introduced by the Nigerian government under the Finance Act 2019 to charge a one-time fee (₦50) on every inward transfer that's ₦10,000 or exceed.
Meanwhile, EMTL is not only for OPay, it's imposed by the CBN to all financial institutions operating in Nigeria. When it was introduced, the levy was only applied to traditional banks. But in September 9, 2024, CBN extended the levy to fintech platforms like OPay, Moniepoint, PalmPay, Kuda and others.
The EMTL was first introduced through the Finance Act 2019, which expanded the scope of dutiable instruments under the Stamp Duties Act (SDA) to include electronic transactions.
The levy officially took effect in 2020, following its formal introduction through the Finance Act 2020, which renamed the charge as EMTL. The EMTL Regulations of 2022 solidified the regulation to streamline its administration and collection.
Despite that the EMTL was extended to fintech companies in Nigeria in September 2024, OPay started implementing the levy on December 1, 2024. Customers received notifications stating that a ₦50 fee would be applied to electronic transfers of ₦10,000 and above, in compliance with Federal Inland Revenue Service (FIRS) regulations.
The company clear it self out of the situation by highlighting that the levy doesn't benefit the company in anyways. "This charge is mandated by the federal government and does not benefit the company directly," part of the notice read.
Moniepoint states that government will distribute the collected levies according to the Finance Act’s latest formula. The government imposed the EMTL to collect tax from the digital economy that booming because traditional tax methods like stamp duties on paper-based transactions no longer cut it. This levy will help pay for things like schools, hospitals, and roads.
However, it's worth noting that this method of taxation is not just a Nigeria thing. Other countries, like Kenya and India, do the same to make sure the government doesn’t lose money as people stop using cash. It’s a way to keep things fair and still fund public services, and fintech companies like OPay must follow this rule to avoid fines and keep their services running smoothly.
