Cameroon’s Tax on Mobile Money: Implications for Agents' Performance and Revenue Sustainability

Abstract

Mobile money taxation gives African governments an opportunity to broaden their fiscal base and explore new revenue-generating possibilities. Cameroon introduced a 0.2 per cent tax on mobile money transfers and withdrawals from 1 January 2022. Our research analyses the behaviour of agents, who act as intermediaries between mobile money account holders and mobile money service providers, before and after the tax on mobile money (MM tax). Agents play a key role in the distribution of mobile money services. Their presence is vital for achieving financial inclusion, especially in areas less served by banks and other traditional financial service providers. An agent’s revenue is mainly derived from commission earned on each transaction – they receive an average of 40–45 per cent of the commission, and the remaining 55–60 per cent is shared between the mobile network operator, partner banks, and agent’s manager (superagent). Given their importance in the mobile money ecosystem, factors that negatively affect the attractiveness of the business for agents could have policy implications on financial inclusion. Summary of ICTD Working Paper 192.