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Increase In Cash Payments As Government Introduces ₦50 Stamp Duty On Individual POS Transactions Above ₦1,000

Increase In Cash Payments As Government Introduces ₦50 Stamp Duty On Individual POS Transactions Above ₦1,000
A few months ago, the news broke out that the federal government was trying to impose a ₦50 stamp duty on individual POS transactions exceeding ₦1,000.
The information started off as a rumour but in a space of time, we were told that a number of merchants have upgraded their POS machines to automatically charge the extra ₦50 on transactions made by their customers.
In the course of our investigation, one of the InfoGuideAfrica authors decided to do a test withdrawal of ₦1,000 in a local POS stand and guess what, the lady charged him ₦1,100. '₦50 was for the withdrawal and ₦50 was for the stamp duty', she said.

From the business owners...

We contacted a number of filling stations and most of them complained on the new law, while insisting that the customers pay the charges. Other businesses like supermarkets and pharmacies that offer POS payments also gave similar opinions.

Inasmuch the ₦50 charge is something most Nigerians can easily pay, business analysts still suggest that it could have negative consequences for the CBN’s cashless policy plans.

Although the business owners we contacted didn't report any significant decrease in the rate at which people pay with POS, a number of them recorded an increase in the number of cash transactions daily.

A business owner also said that 'most customers are unaware of the charge and may not react as negatively if their consent was sought before charging them the tax'. 

This could perhaps be the norm as more Payment Service Providers (PTSP) will upgrade their POS machines to allow merchants automatically charge the ₦50 stamp duty tax from their customers.

Implications on the economy... 

If the CBN discourages cash-based transactions, and at the same time imposes multiple charges to electronic-based transactions, it may be running the risk of policy inconsistency, capable of aggravating the already tensed ease of doing business environment in the country.
Recall that the CBN was already imposing charges on cash lodgements and withdrawals in excess of ₦500,000 and ₦3 million for individuals and corporate bodies, respectively.

This is something that I would call a clash of moves, imposing a POS withdrawal charge and cash lodgements/withdrawals charges.

This isn't okay to the ordinary Nigerians as they don't work towards reducing the banking charges, but rather enriching the banks, which are the collecting agents.

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