The verdict in three sentences
The headline rate — 1 % on fast wallets, 1.5 % on others — is only the visible part; cash-out fees (1-2 %), vendor payout fees, VAT on commission and FX spread can double your real cost. On a 25,000 FCFA basket, the margin eaten often jumps from a shown 250 FCFA to 500-700 FCFA in reality. Knowing every fee line means recovering 1 to 2 margin points on every sale.
The headline rate per operator
Start with the base commission everyone compares.
| Operator | Headline commission | Fixed fee | Cap / transaction |
|---|---|---|---|
| Fast wallet | 1.0 % | 0 FCFA | High |
| Second operator | 1.5 % | 0 FCFA | Variable |
| MTN MoMo | 1.5 - 2.0 % | 0 FCFA | Variable |
| Paystack | 1.5 % | +100 NGN | Capped |
| Flutterwave | 1.4 % | Variable | Variable |
At this stage the fast wallet looks unbeatable. But commission is only a third of the story.
The fees nobody displays
Here are the invisible layers that stack up based on real usage.
| Fee type | Ballpark | Who pays |
|---|---|---|
| Cash-out (cash withdrawal) | 1 - 2 % | Merchant or customer |
| Vendor payout (marketplace) | 0.5 - 1 % | Platform |
| VAT on commission | ~18 % of commission | Merchant |
| FX spread cross-border | 1 - 3 % | Cross-border merchant |
| Account / subscription fee | 0 - 15,000 FCFA/month | Merchant |
VAT is the most common trap: a 1.5 % commission carries ~18 % VAT, an effective cost of ~1.77 %. On a cross-border flow, FX spread adds another 1 to 3 points.
Mini case study
Grace, a jewelry maker, sells a 25,000 FCFA basket. With a fast wallet at 1 %, commission is 250 FCFA, VAT included ~295 FCFA. If she then withdraws proceeds as cash (cash-out 1.5 %), she pays 375 FCFA more. Total real cost: ~670 FCFA, i.e. 2.7 % not 1 %. Across 300 baskets/month, the gap between the headline rate (75,000 FCFA) and real cost (~201,000 FCFA) is 126,000 FCFA/month. By leaving funds on the wallet to pay suppliers directly, she avoids cash-out and recovers ~112,500 FCFA/month.
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FAQ
Is the 1 % headline rate really the final cost?
No. With VAT (~18 %) and possible cash-out (1-2 %), real cost often reaches 2 to 3 %. The 1 % only covers collection commission.
How do I avoid cash-out fees?
By paying suppliers directly from the wallet rather than withdrawing cash. That removes the 1-2 % cash-out line.
Is VAT on commission recoverable?
If you're VAT-registered, commission VAT may be deductible. It's ~18 % of commission, about 0.27 point on a 1.5 % commission.
Does FX spread affect everyone?
No, only cross-border flows via Paystack/Flutterwave. It adds 1 to 3 % and disappears on fully local payments.
Which operator is cheapest all-in?
Locally without cash-out, a fast wallet stays most competitive at ~1.2 % effective with VAT. Once cash-out and FX are added, the gap between operators narrows sharply.
Let's talk about your project. We'll audit your real fees line by line and recover the hidden margin points. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
