Electronic money transfer levy (EMTL) extended to domiciliary accounts

Electronic money transfer levy (EMTL) has been extended to domiciliary accounts by deposit money banks (DMBs) in response to complaints about the escalating transaction fees of financial services.

According to communication messages seen by The Guardian, the new levy is effective right away. The charge, which banks carry out on the government’s behalf, was formerly limited to naira accounts.

However, banks informed their clients that the fee would begin to apply to domiciliary accounts immediately pursuant to a decision from Zainab Ahmed, the Minister of Finance, Budget, and National Planning.

As a result, a holder of a dollar or pound account would henceforth pay $50 as EMTL at an exchange rate set by the Central Bank of Nigeria (CBN).

“We write to notify you of recent changes impacting electronic money transfer transactions. The Electronic Money Transfer Levy (EMTL) Regulation was recently issued by the Minister of Finance, Budget, and National Planning.

“Based on the Regulation, the EMTL levy at the foreign currency equivalent of N50 is now applicable on the transfer of funds into domiciliary accounts… EMTL shall apply to qualifying inflows into domiciliary accounts with immediate effect,” an email sent by a bank yesterday reads.

In 2022, Usman officially passed the EMTL Rules, which impose a 50 fee on any deposits over 10,000. The Stamp Duty Act was expanded by the 2019 Budget Act to include fees for electronic transfers.

After a rise in social unrest over the increased cost of banking services, notably electronic transactions that the CBN is vigorously enforcing, the charges have now been extended to foreign currency accounts.

The Guardian had reported a spike in the adoption rate of fintech and shadow banking, which offer cheaper services. Some of the fintech operators have seen a surge in the number of subscribers in recent weeks following the rise in the number of individuals transacting electronically.

Cheap transaction costs, convenience and speed are given as major reasons Nigerian depositors are dumping conventional banks for fintech, despite the concern about the safety of depositors’ funds on digital wallets in the custody of the digital-first banks.

Interestingly, the pressure is beginning to take a toll on the efficiency of fintech firms, which are becoming the vampires in the ecosystem. Hence, downtime incidents are becoming daily experiences across the leading operators – a situation that will make choosing between the two variants a more complicated one for depositors.

Rebecca Ahoame

Written by Rebecca Ahoame

Rebecca is a Student of the Federal University Lafia, Nasarawa State, North-Central Nigeria. She has passion for writing and research. Rebecca writes for NewsWay on Business and Finance.

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