The Central Bank of Nigeria (CBN) has imposed a levy of 0.5% on all electronic transactions in what the apex bank cites as the implementation of the nation’s amended cybercrime laws.
According to the CBN, the levy was imposed by the Cybercrime (Prohibition, Prevention, etc.) Amendment Act 2024, provides for the 0.5% levy on all electronic transactions as a preemptive measure against rising cyber threats in the country.
This amendment builds upon previous directives from the CBN regarding compliance with the Cybercrimes Act of 2015, aiming to bolster the nation’s cyber resilience, the apex bank said.
According to CBN, the penalty for non-compliance is in accordance with Section 44 (8) of the Act which prescribes that “failure to remit the levy is an offence and is liable on conviction to a fine of not less than 2% of the annual turnover of the defaulting business, amongst others”.
The levy, CBN said, equal to half a percent of the transaction value, will contribute to the National Cybersecurity Fund (NCF), overseen by the Office of the National Security Adviser (ONSA).
Following the amendment, the apex bank has mandated all banks, financial institutions, and payment service providers to implement the levy at the inception of electronic transfers. The deducted sum will be clearly annotated as “Cybersecurity Levy” in customers’ accounts.
The CBN directive stipulates that deductions are to commence within two weeks of the circular’s issuance, with subsequent monthly remittances to the NCF account domiciled at the Central Bank of Nigeria (CBN) by the fifth business day of each month.
According to CBN, the penalty for non-compliance is in accordance with Section 44 (8) of the Act which prescribes that “failure to remit the levy is an offence and is liable on conviction to a fine of not less than 2% of the annual turnover of the defaulting business, amongst others”.
To facilitate compliance, a phased approach has been outlined for system reconfigurations: within four weeks for commercial banks, merchant banks, non-interest banks, payment service banks, and mobile money operators, and within eight weeks for other financial institutions, including microfinance banks, primary mortgage banks, and development finance institutions.
An attachment detailing exempted transactions aims to prevent duplication of levy applications on the same transfer, covering scenarios such as loan disbursements and repayments, salary payments, intra-account transfers within the same bank or between different banks for the same customer, intra-bank transfers between customers of the same bank, Other Financial Institutions (OFIs) instructions to their correspondent banks, interbank placements, banks’ transfers to CB and vice-versa, inter-branch transfers within a bank, and cheques clearing and settlements.
The Act emphasises penalties for non-compliance, this includes fines of not less than 2% of the defaulting business’s annual turnover, among other repercussions.
The CBN has also directed all institutions under its regulatory purview to adhere strictly to the Act’s provisions and the circular’s directives.
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