The Origin of Stamp Duty on Electronic Payment
Quote from Ndubuisi Ekekwe on September 21, 2018, 10:50 AMThis piece explains why you pay N52.50 anytime you transfer money electronically in Nigeria. Apparently, Nigeria has not updated its regulations from the pre-1960 when Stamp Duty was about moving financial instruments via postal service. Today, NIPOST gets paid money even when it has no contribution between the partners sending and receiving money. It is very strange banks have not challenged that fee collection. My intuition is that they may be keeping a part of that fee while remitting the rest to NIPOST under mutual arrangement. Otherwise, it makes no sense to pay for stamp duty when you use your bank app, to send money from one bank account to another, even within the same bank, and your bank is enforcing it for NIPOST.
Perhaps, the most ridiculous of the frivolous charges is the N52.50 paid to NIPOST for every funds transfer transaction. The banker customer relationship is a contract.
And I ask, is NIPOST a party to the contract between a bank and its customer to be entitled to remuneration or did NIPOST provide a platform (service) for the transfer to be effected that earns it remuneration? The answer is no.
Justifying the charge by quoting the provisions of Stamp Duty Act that requires payment of stamp duty on financial transactions amounts to implementing an old order in a new dispensation.
At the time Stamp Duty Act was enacted by our colonial masters, financial transfers or transactions were conducted strictly with cheques.
This piece explains why you pay N52.50 anytime you transfer money electronically in Nigeria. Apparently, Nigeria has not updated its regulations from the pre-1960 when Stamp Duty was about moving financial instruments via postal service. Today, NIPOST gets paid money even when it has no contribution between the partners sending and receiving money. It is very strange banks have not challenged that fee collection. My intuition is that they may be keeping a part of that fee while remitting the rest to NIPOST under mutual arrangement. Otherwise, it makes no sense to pay for stamp duty when you use your bank app, to send money from one bank account to another, even within the same bank, and your bank is enforcing it for NIPOST.
Perhaps, the most ridiculous of the frivolous charges is the N52.50 paid to NIPOST for every funds transfer transaction. The banker customer relationship is a contract.
And I ask, is NIPOST a party to the contract between a bank and its customer to be entitled to remuneration or did NIPOST provide a platform (service) for the transfer to be effected that earns it remuneration? The answer is no.
Justifying the charge by quoting the provisions of Stamp Duty Act that requires payment of stamp duty on financial transactions amounts to implementing an old order in a new dispensation.
At the time Stamp Duty Act was enacted by our colonial masters, financial transfers or transactions were conducted strictly with cheques.