If the planned electronic transaction levy (e-levy) is enacted in its current form, the Chief Executive Officer of Afb Ghana, the operators of MTN’s Qwikloan services, has warned that the company may cease to exist in a year.
On Wednesday, November 17, 2021, Finance Minister Ken Ofori-Atta presented the 2022 budget declaration to Parliament, proposing a 1.75 percent tax on electronic financial transactions.
The tax policy, according to the Minister, was designed to raise income to promote job creation programs, road infrastructure projects, cybersecurity, and digital infrastructure.
Ken Ofori-Atta hoped that by February 2022, the concept will be fully implemented. Ghanaians, on the other hand, are overwhelmingly opposed to the proposal.
As a result of the proposed e-Levy and other concerns made in the budget, the minority group in Parliament rejected it for the fiscal year 2022.
In 2017, MTN Ghana, in collaboration with Afb GHANA, developed the “Qwikloan” service to help consumers in times of need.
Customers can use their MTN mobile money platform to access loans through the “Qwikloan” service, which is quick, straightforward, and convenient.
Qwikloan is a short-term loan that lasts 30 days. It features flexible payment arrangements with a 6.9% interest rate, however, a default payment will result in a 12.5 percent interest rate. It does not require a bank account or a guarantor to use.
However, in a Facebook post commemorating Afb Ghana’s four-year anniversary on November 30, 2021, the company’s CEO, Arnold Parker, cautioned that if the government proceeds with the e-levy in its current form, the service will be shut down.
“We introduced what has undoubtedly become Ghana’s most widely used financial product, Quick loan, four years ago today, with our partners MTN and Jump.” We have disbursed approximately Ghc7 billion to well over 4.2 million people in the 4 years that Quickloan has been in operation. “It’s interesting that the Quickloan anniversary falls with the e-Levy debate,” Arnold Parker observed.
“If I feed in the suggested e-Levy rate into our financials, Quickloan would be defunct in a year,” he continued. Yet it is a product like Qwikloan, which has helped millions of people in dire straits, that has the capacity to alter our economy.”
In a previous post, Arnold Parker recommended against the government giving away free items.
“Now is the time to focus on growing our economy. When a country’s GDP is meant to be $600 billion, it shouldn’t be okay if it’s just $60 billion. We have been operating much below our capacity for decades, robbing millions of our kith and skin of a good existence. The more freebies we promise people, the more
businesses we need to enable to thrive in order to locate them. It’s time to start and expand Ghanaian companies.