The Electronic Transaction Levy (E-levy) introduced by Mobile Money Limited-MTN Ghana has led to a dip in mobile money transactions, according to Sylvia Otuo-Acheampong, Head of Products and Innovations.
The levy’s introduction on electronic transactions impacted mobile money usage as it increased the cost of transactions for users. Consequently, some users became reluctant to use the service. The E-levy was introduced in 2022 and initially set at a rate of 1.75 percent on the value of transactions over GHȼ100.
However, later in 2022 government announced a revision of the e-levy rate following public outcry, which reduced the rate to 1.5 to percent. Currently, the rate has been reduced to 1 percent across all transactions – without exemptions, unlike in 2022.
The Head of Products and Innovations noted that like any other business, introduction of the E-levy led to a reduction in demand as the increase in price led to revenue reductions. However, despite the impact, Mobile Money Limited has noted a resurgence as customers return to digital payments amid a revised rate on e-levy transactions.
“We saw in the statistics that we track…the number of customers which are using the service, and also revenue at the end of the day. So we saw this in the core metrics that we measure, but after a while, we saw the whole customer patronage really picking up again. So before we ended last year, we had seen customers come back; and also after the E-levy was lowered from 1.5 to 1 percent, we have seen the numbers coming up. So I would say we are now getting to where we were previously,” said Ms. Otuo-Acheampong.
MTN Mobile Money Limited now counts over 13 million Ghanaians using its platform, with over 140,000 merchants using it as a form of payment – including face-to-face and remote transactions. Additionally, the platform has over 15,000 point-of-sale (POS) machines across the country that accept mobile money transactions, with 240,000 agents nationwide supporting the ecosystem.
While the platform has seen significant success, Otuo-Acheampong also discussed the issue of fraud. The platform has been working to educate staff on fraud prevention and detection, both internally and through partnerships with security agencies, with the goal of protecting customer funds.
However, Otuo-Acheampong noted that the biggest challenge remains educating vulnerable customers and encouraging them to keep their personal identification numbers (PINs) confidential.
“There are certain metrics we have to fulfil, and so they [regulators] will come in to ensure you’re actually putting in place the right mechanisms, the right tools to curb fraudulent activities; and so it is a joint kind of ownership with the regulators… we can put all these measures in place, but if an individual chooses to share their PIN there is really nothing we can do from there,” said Ms. Otuo-Acheampong.
Mobile Money Limited is not only committed to combatting fraud but also advocating cheaper transaction fees for customers. According to Otuo-Acheampong, this is achievable by reducing the cost of technology from government’s perspective, including decreasing taxes on technology products and encouraging vendors to offer affordable alternatives to perform similar transactions.
“We have to find a way to reduce the cost of technology… it could also be the vendors themselves finding ways to bring in cheaper technology that performs the same transaction or delivers the same services… I think it is a multi-form approach,” said Ms. Otuo-Acheampong.
Mobile Money Limited is committed to continuing its growth and success in the Ghanaian market, with further emphasis on fraud prevention and advocating more affordable options for customers.