The Impact of Ghana's Electronic Transfer Levy (E-Levy) on Mobile Money Adoption and Financial Inclusion: A Natural Policy Experiment (2018-2025)

The rapid expansion of mobile money has significantly improved financial inclusion across SubSaharan Africa. In Ghana, the introduction of the Electronic Transfer Levy (E-Levy) in May 2022 raised concerns about its impact on digital financial services. This study examines the effects of the E-Levy on mobile money activity and financial inclusion using monthly data from September 2018 to December 2025. Employing an Interrupted Time Series framework with HAC (Newey-West) robust standard errors, the analysis evaluates the levy introduction, the January 2023 rate reduction, and the April 2025 repeal on transaction value, volume, active accounts, active agents, and substitution toward GH-Link. Results show that the E-Levy significantly reduced mobile money transaction activity. A one percentage point increase in the levy rate is associated with a level-shift coefficient of -0.250 (p < 0.001) for transaction value (≈22% reduction) and -0.071 (p < 0.01) for transaction volume (≈7% reduction). While active accounts remained relatively stable, their growth and agent network expansion slowed. Significant substitution toward the untaxed GH-Link platform was also observed. Following the April 2025 repeal, the repeal dummy was statistically insignificant (p = 0.587), indicating short-run behavioral persistence. The findings suggest that digital transaction taxes can generate unintended consequences for financial inclusion by reducing transaction intensity and encouraging platform substitution. They highlight the need to carefully balance revenue mobilization with digital transformation goals in developing economies.