CBN Directs Nigerian Banks To Impose 0.5% Cybersecurity Levy On All Transactions

The Central Bank of Nigeria (CBN) has mandated banks operating within the country to start charging a cybersecurity levy on transactions.

A circular issued on Monday, May 6, said the implementation of this levy is set to commence two weeks from today.

The circular was addressed to all commercial, merchant, non-interest, and payment service banks, among others.

It serves as a follow-up to prior correspondences dated June 25, 2018 (Ref: BPS/DIR/GEN/CIR/05/008) and October 5, 2018 (Ref: BSD/DIR/GEN/LAB/11/023), emphasizing compliance with the Cybercrimes (Prohibition, Prevention, Etc.) Act 2015.

Additionally, it references recent public discussions by the Office of the National Security Adviser on this matter.

The circular reads, “Following the enactment of the Cybercrime (Prohibition, Prevention, etc) (amendment) Act 2024 and pursuant to the provision of Section 44 (2)(a) of the Act, ‘a levy of 0.5% (0.005) equivalent to a half percent of all electronic transactions value by the business specified in the Second Schedule of the Act,’ is to be remitted to the National Cybersecurity Fund, which shall be administered by the Office of the National Security Adviser.”

The directive mandates all banks, financial institutions, and payment service providers to enforce this levy.

It added that “The levy shall be applied at the point of electronic transfer origination, then deducted and remitted by the financial institution. The deducted amount shall be reflected in the customer’s account with the narration, ‘Cybersecurity Levy’.

“Deductions shall commence within two weeks from the date of this circular for all financial institutions and the monthly remittance of the levies collected in bulk to the NCF account domiciled at the CBN by the fifth business day of every subsequent month.”

Exemptions from the levy include loan disbursements and repayments, salary payments, intra-account transfers within the same bank or between different banks for the same customer, as well as inter-branch transfers within a bank, among others.

The directive highlights the CBN’s recent efforts to enhance oversight within the financial sector.

This initiative follows a directive barring fintechs from onboarding new customers, with fintechs in turn advising against engaging in crypto transactions on their platforms.

KanyiDaily recalls that the Central Bank of Nigeria (CBN) recently issued a directive prohibiting the use of foreign currency (FCY) as collateral for Naira loans.