In a bid to modernise tax collection, the Federal Inland Revenue Service (FIRS) has partnered with Flutterwave, a leading African digital payment company.
Announced in March 2025, the collaboration aims to simplify tax payments for individuals and businesses through digital platforms, improving efficiency and transparency.
Since its founding in 2016, the company has expanded its reach to 34 African countries, establishing itself as a leading provider of payment solutions.
It is backed by investors like Y Combinator, Visa Ventures, and Tiger Global and has raised around $484.7 million, pushing its valuation beyond $3 billion.
Why this move matters
Nigeria has long struggled with low tax compliance. In 2022, the country’s tax-to-GDP ratio stood at 10.86%, falling short of the World Bank’s recommended minimum of 15%.
To address this, the FIRS has set a goal to raise the ratio to 18% within three years, with digital tax collection expected to play a significant role.
The partnership between FIRS and Flutterwave is part of this push. By integrating digital payment solutions, taxpayers will be able to remit taxes through multiple channels, including bank transfers, card payments, and other electronic options.
The system also offers real-time payment tracking and offline payment alternatives, making tax remittance more accessible, including for Nigerians in the diaspora.
Speaking on the development, Flutterwave CEO Olugbenga Agboola said, “By making tax payments easier and more transparent, we are helping to digitise government collections and support national development.”
This collaboration is part of a broader government effort to modernise public revenue collection.
Earlier in March, the Office of the Accountant-General of the Federation announced changes to the Treasury Single Account (TSA) payment system.
Previously managed by Remita, the system will now be replaced with the Treasury Modernisation and Revenue Assurance System (TMRAS), which integrates multiple private payment providers.
By allowing more payment platforms, the government aims to improve efficiency, reduce bottlenecks, and enhance revenue tracking.
With Flutterwave now involved, Nigeria is taking active steps to streamline tax payments and boost compliance.
Impact of this partnership
While the FIRS remains in charge of tax collection, outsourcing payments to a private company raises questions about accountability.
If technical failures or disputes occur, it is unclear whether the government or Flutterwave would be held responsible.
These concerns have surfaced in other markets. In Kenya, Flutterwave faced regulatory scrutiny when the central bank accused it of operating without a proper licence.
The company was also linked to an anti-money laundering investigation, which led to a temporary freeze on its accounts.
Although the case was later withdrawn, it highlighted the complexities of regulatory compliance for private payment firms.
As Nigeria integrates more digital platforms into tax collection, there is the need for clear regulatory frameworks and oversight to ensure smooth operations and maintain public trust.
