Nigerians express concern over the increasing inflation as multiple bank charges add to their financial burdens.

Nigerians facing the challenges of difficult socio-economic conditions are expressing growing concern over what they perceive as excessive bank charges, particularly stamp duty. This unease is amplified by the impact of inflation on the purchasing power of the naira.

President Bola Tinubu recently acknowledged the hardships Nigerians are enduring, attributing them to the government’s decision to eliminate fuel subsidies and standardize the foreign exchange rate.

Bank customers, voicing their frustrations, highlight the escalating deductions with each transaction, including commissions, Value Added Tax, Telco charges, stamp duty, and transfer fees. Some find it especially irksome that federal, state, and local governments share a portion of these deductions through the Electronic Money Transfer Levy (EMTL).

Notably, the Federal Government stands to accrue N483.73 billion over three years from the EMTL, introduced in the Finance Act 2020 to tap into the surge in electronic funds transfers. This one-time N50 charge applies to electronic transactions of N10,000 and above, with the revenue distributed among the three tiers of government.

While some customers express dismay over the perceived hardship imposed by such charges, others argue that Nigeria’s approach differs from countries like Ghana, which levies a percentage on transactions. They suggest that a more aggressive expansion of the tax net, particularly in the digital economy, could enhance revenue.

Recent developments include the reduction in processing fees for transactions on the Nigerian Inter-Bank Settlement System (NIBSS) platform. The lower fee, effective from July 1, 2023, aims to stimulate increased transaction volume, potentially benefiting banks with significant market share in electronic payment services.

Despite concerns about the impact of fee reductions on banks’ profitability, stakeholders recognize the need for a balance between customer-friendly practices and maintaining financial institutions’ revenue streams. It’s crucial to note that all deposit banks and financial institutions are mandated to charge a stamp duty of N50 on eligible transactions above N10,000, with exemptions for intra-bank transfers and salary accounts. The 2020 Finance Act modified the Stamp Duties Act, introducing the EMTL and its associated charges on electronic receipts and transfers.