The Central Bank of Nigeria (CBN) has withdrawn the directive to banks and other financial institutions to charge cybersecurity levy on electronic transfers.
Savvy media recalls that on May 6, the apex bank directed all commercial, merchant, non-interest and payment service banks, mobile money operators and payment service providers to charge a 0.5 percent cybersecurity levy on electronic transfers.
According to the apex bank, the deduction and collection of the cybersecurity levy is a sequel to the enactment of the Cybercrime (prohibition, prevention etc) Amendment Act of 2024.
CBN said the charges would be remitted to the national cyber security fund, and be administered by the office of the national security adviser (ONSA).
However, CBN halted the move to charge the cybersecurity levy in a circular titled ‘Re: Cybercrimes (Prohibition, Prevention, ETC) (Amendment) Act 2024 — Implementation Guidance on the Collection and Remittance of the National Cybersecurity Levy,’ and dated May 17.
The circular which was made public on May 19 was signed by Chibuzo Efobi, director, payments system management department, and Haruna Mustafa, director, financial policy and regulation department.
“Please be advised that the above referenced circular [the circular that implemented the levy] is hereby withdrawn,” the circular signed by Chibuzo Efobi, the director of the central bank’s payment system management team, and Haruna Mustafa, the director of financial policy and regulation, read.
The cybersecurity levy was seen as “regressive” by financial industry experts due to the sharp increase in the cost of an electronic transaction amidst the country’s highest inflation rate in thirty years and a cost of living crisis.
Following mounting pressure from labour unions, the federal government suspended the levy and said it would be reviewed on Tuesday.
The now-revoked cybersecurity levy meant an electronic transfer of ₦1,000 would attract a ₦5 fee, while a ₦100,000 transfer would attract a ₦500 fee.
“Since I heard of the levy, I have only transferred money to bank accounts in my bank,” Ope, an online phone seller said.
The levy would have been charged in addition to a stamp duty charge, an SMS charge, and a charge from the national payment switch. A ₦10,000 electronic transaction fee would have cost ₦130.875. But loopholes existed, like an exception with money transfers within the same bank, salary payments, school fees payments, and loan repayments.
Its removal would be welcomed by many Nigerians who have come to increasingly rely on electronic transfers as a primary means of payment.
