The Mobile Money Agents Association of Ghana, says most of its members may shut down their mobile money businesses following the passage of the 1.5% Electronic Transfer Levy.
“We may be tempted to withdraw our services because the service already is not all that lucrative,” the General Secretary for the association, Evans Otumfour, said in a Citi News interview.
“A lot of our people will definitely be out of business… when the policy was announced, there was a sharp decline or drop in the use of mobile money,” he added.
The levy, which was amended from 1.75 percent to 1.5 percent today, Tuesday, March 29, 2022, will be a tax on electronic transactions, which includes mobile-money payments.
The charge will apply to electronic transactions that are more than GH¢100 on a daily basis.
Critics of the proposal have warned that this new levy will negatively impact the Fintech space, as well as hurt low-income people and those outside the formal banking sector.
The government has, however, argued the levy would widen the tax net and that could raise an extra GH¢6.9 billion in 2022.
Parliament passed it in the absence of the Minority MPs, who had walked out before the Bill was seriously considered.
The Minority had complained that it had been blindsided by the unexpected laying of the controversial tax.
It subsequently said it would challenge the passage of the levy at the Supreme Court.
Speaking at a press conference on Tuesday, the Minority Leader, Haruna Iddrisu, said the passage was unconstitutional, as Parliament did not have the required numbers to make a decision on the e-levy.
“I think they have to come again on E-levy because as of today, I don’t think they had the numbers to say that the E-levy has been passed. We will question this decision in [the Supreme] court on the basis of the earlier ruling and on the basis of the fact that they said we can’t take a decision with 137 [members], but they can take with 137,” he said.
The Bank of Ghana also reports that in 2021, there were 40.9 million registered mobile money accounts and 17.5 million active accounts.
It is also reported that the value of transactions on the country’s largest payment platform decreased to GH¢82.9 billion in December from GH¢86.1 billion recorded in November 2021, representing a 3.8 percentage points decline.
In Ghana, the limit for MTN Momo includes 2000GHS daily and 20,000GHS monthly transactions limit for Tier 1 momo customers. In contrast, Tier 2 MTN Momo customers have a limit of 5,000GHS daily and 50,000GHS monthly.
The cost of MTN MOMO transfer is 1% of the money you are sending. That means that MTN charges you one percent of any amount of money you transfer from your MOMO account as a fee. Other Networks charge around the same amount as service fees.