How Increasing Mobile Money Levy Could Transform NHIMA Funding
By George N. Mtonga, MBA
Zambia’s National Health Insurance Management Authority (NHIMA) faces a long-term structural challenge that policymakers can no longer ignore.
The country’s informal sector forms the majority of the economy and consumes a substantial share of healthcare services under NHIMA, yet contribution levels remain significantly below utilization levels. In many cases, healthcare consumption may exceed premiums contributed by several multiples.
This creates a financing gap that must eventually be closed if Zambia wants NHIMA to remain sustainable.
The solution may already exist within Zambia’s financial ecosystem: mobile money.
Zambia Already Has the Infrastructure
According to recent transaction data, Zambia processes approximately:
3.0 to 3.4 billion mobile money transactions annually.
This means Zambia already possesses:
a nationwide digital payment network,
daily transaction visibility,
and an automatic collection mechanism reaching millions of informal-sector participants.
Instead of relying entirely on payroll deductions from the formal sector, Zambia can use the mobile money ecosystem to help fund healthcare access for the broader population.
Potential Revenue From a Health Levy
If government introduced a dedicated NHIMA Health Levy through mobile money transactions, the revenue potential becomes significant.
Scenario 1: Low Levy Structure
Average levy collected:
K0.50 per transaction
Annual transactions:
3.0 billion
Potential annual revenue:
K1.5 billion
Scenario 2: Moderate Levy Structure
Average levy collected:
K1.50 per transaction
Annual transactions:
3.0 billion
Potential annual revenue:
K4.5 billion
Scenario 3: Strong Funding Structure
Average levy collected:
K2.00 per transaction
Annual transactions:
3.4 billion
Potential annual revenue:
K6.8 billion annually
What This Means for NHIMA
To put this into perspective:
A K4.5 billion to K6.8 billion annual health levy would be large enough to materially strengthen NHIMA’s financing position.
That level of funding could help:
reduce reimbursement delays to hospitals,
improve drug availability,
stabilize healthcare provider payments,
expand coverage sustainability,
support specialized treatment programs,
and reduce pressure on the national treasury.
Most importantly, it creates a mechanism where the informal economy contributes to the healthcare system through the financial channels it already uses daily.
Why Mobile Money Is the Best Mechanism
The informal sector largely operates outside:
PAYE systems,
corporate payroll structures,
and traditional income tax frameworks.
But the same sector heavily relies on:
MTN MoMo,
Airtel Money,
and other mobile payment systems.
This makes mobile money the closest thing Zambia has to a universal informal-sector contribution platform.
Instead of attempting to force millions of informal businesses into difficult administrative tax systems immediately, government can gradually collect small healthcare-support levies through an already functioning digital ecosystem.
The Most Important Condition: Transparency
Citizens are far more likely to support a levy increase if government clearly states:
“This levy directly funds NHIMA and healthcare services.”
If people can visibly connect the levy to:
medicine availability,
hospital funding,
emergency care,
and healthcare access,
public resistance becomes easier to manage.
The debate should no longer focus on whether Zambia needs sustainable NHIMA funding.
The real debate is how to build that sustainability fairly.
The formal sector alone cannot indefinitely finance healthcare access for the entire economy while the majority of transactions increasingly occur digitally within the informal sector.
Mobile money provides Zambia with:
the infrastructure,
the transaction volume,
and the collection efficiency
needed to close the healthcare financing gap.
The opportunity now is to strategically transform mobile money from merely a payments platform into a long-term national healthcare financing mechanism.
Last year I paid my NHIMA in full for the whole year. Using my airtel money. Despite this, NHIMA services have been suspended at the dental service that initially carried out some work.
I still have to buy medication that isn’t available at NHIMA accredited clinics.
Meanwhile NHIMA bosses continue drawing salaries of over 80 pin per month.
There is no shortage of jokers in Zed. NHIMA is actually a (quasi-voluntary) tax on top of already existing taxes, a clear indication that government is failing to balance it’s books. Even with substantial donor support to the health sector.
Broadening the tax base to capture more taxes may help, but if the secured tax revenue goes towards fixing some other sector, we are still at zero.
And because of failure to pay accredited private medical units, NHIMA is now also facing serious competition from other insurance agencies who see the gap in the market.
NHIMA was moved from Ministry of Labour and Social Services to Ministry of Health. Clearly that hasn’t helped. It just delayed the inevitable. Ministry of Health administrators are grappling with multiple challenges and may not be giving NHIMA the attention it deserves to enable it to perform to expectation.
There are several very successful national insurance health schemes in other countries that NHIMA can model themselves after. And even partner with to reduce the time scale on the learning curve.
Zambia’s population demographics indicate greater demand of medical services from the increasing number of elderly citizens who are more susceptible to non-communicable diseases and cancers.