MoMo Agents Association has disclosed that the Mobile Money (MoMo) industry in Ghana has faced a major setback in recent years since the introduction of the e-levy, leading to the collapse of 17,000 MoMo businesses across the country.

The Mobile Money Agents Association of Ghana has attributed this decline to the implementation of the electronic transaction levy (E-Levy), which significantly affected agents’ working capital and drove many out of business.

With the new government’s decision to scrap the levy, MoMo agents are hopeful that the industry can recover and regain its role as a key financial service provider for millions of Ghanaians.

The E-Levy, introduced in 2022, imposed a tax on electronic financial transactions, including mobile money transfers, bank transactions, and even transfers between MoMo agents. From the onset, the tax faced widespread criticism, particularly from small businesses, informal sector workers, and low-income earners who rely heavily on mobile money for daily transactions.

According to the Mobile Money Agents Association of Ghana, an internal survey conducted after the levy was rolled out revealed that many agents struggled to sustain their businesses. The multiple tax deductions on transactions significantly reduced their operating capital, forcing many to close their businesses.

Evans Otumfuo, General Secretary of the association, explained that the E-Levy had a severe effect on MoMo agents, leading to job losses and economic hardships for thousands of families.

“The deductions affected not just customers but also the agents. Our working capital was reduced drastically, making it unsustainable for many of us to continue operating,.”
Evans Otumfuo

Government Scraps E-Levy in 2025 Budget

Recognizing the economic burden imposed by the E-Levy, the government has taken steps to remove the tax as part of its broader strategy to ease the cost of living and restore business confidence.

During the presentation of the 2025 Budget Statement and Economic Policy on March 11, Finance Minister Dr. Cassiel Ato Forson has abolished the e-levy tax. He acknowledged that the tax, introduced by the previous administration, failed to generate the expected revenue and instead contributed to economic difficulties for businesses and individuals.

“The removal of these taxes is part of our strategy to ease the cost of living and restore confidence in the economy,” Dr. Forson told lawmakers.

The decision to scrap the E-Levy has been met with widespread approval, particularly among MoMo agents and small businesses. The Mobile Money Agents Association has welcomed the move, describing the levy as “counterproductive” and a major obstacle to financial inclusion.

With the removal of the tax, MoMo agents are optimistic that their businesses will experience a resurgence, allowing them to serve customers without the fear of excessive transaction fees. The association believes that restoring confidence in mobile money transactions will help drive financial inclusion, especially in rural areas where banking services are limited.

However, some analysts caution that while removing the E-Levy will provide relief to businesses and consumers, the government must find alternative revenue streams to fund development projects. The E-Levy was initially introduced to boost domestic revenue, and its removal means the government will need to improve tax collection efficiency in other areas.

Broader Tax Reforms and Economic Outlook

Beyond the removal of the E-Levy, the government has announced broader tax relief measures aimed at supporting businesses and traders.

Finance Minister Dr. Forson revealed plans to introduce a new tax structure that promotes production and business expansion without placing excessive burdens on individuals and small enterprises. “We are working on a tax structure that encourages production and business expansion without suffocating individuals and small enterprises,” he said.

The government has also pledged to shift its focus towards improving revenue collection rather than imposing new taxes. Dr. Forson emphasized that the state must raise enough funds for development projects without further increasing the tax burden on citizens.

With the abolition of the E-Levy, Ghana’s mobile money sector is expected to witness a revival. Many MoMo agents who left the industry due to financial constraints may consider returning, while customers who avoided mobile money transactions due to high charges may regain confidence in the system.

The success of this move will, however, depend on how effectively the government manages revenue collection and economic growth. As Ghana moves towards a more digital and cashless economy, policymakers must strike a balance between taxation, financial inclusion, and economic expansion.

For now, the removal of the E-Levy brings much-needed relief to MoMo agents and small businesses, signaling a fresh start for Ghana’s mobile money industry.