The Central Bank of Nigeria (CBN) has directed banks and financial institutions to impose a 0.5 percent cybersecurity tax on electronic transfers as part of its efforts to combat cyber threats and strengthen the security of online transactions.
The directive, contained in a circular signed by CBN officials Payment Systems Management Director Chibuzor Efobi and Monetary Policy and Regulation Director Haruna Mustapha on Monday, is intended to ensure that commercial banks, commercial banks, interest-free payment services banks and mobile money issued to. operator.
The CBN said the policy will come into effect within two weeks and the fee will be referred to as a “cybersecurity tax.”
“After the enactment of the Cyber Crimes (Prohibition, Prevention etc.) (Amendment) Act 2024, a levy of 0.5% (0.005) equal to 0.5% in terms of section 44(2)(a) of that Act.” Of the value of all electronic transactions by operators specified in the Second Schedule of the Act, the entire amount shall be remitted to the National Cyber Security Fund (NCF) and managed by the Office of the National Security Adviser (ONSA).” said the CBN.
All banks, financial institutions, and payment service providers are required to implement tax upon initiation of electronic transfers. The amount of the deduction must be clearly displayed in the customer's account under the name “Cybersecurity Tax.”
Certain transactions, such as loan payments, payroll payments, and interbank transfers, are exempt from tax to support essential financial operations. In addition, only intra-branch transfers, clearing and settlement of checks, letters of credit, financing related to bank recapitalization, collection accounts including transactions involving long-term investments, and large transfers from savings and deposits are exempt from tax. Exempted. Among other things.
The CBN has recently been working to clean up the financial sector. It recently issued a directive banning fintech companies from acquiring new customers. Fintech companies are warning customers not to participate in cryptocurrency transactions on their platforms.
CBN’s efforts are in line with its commitment to strengthen cybersecurity in the financial sector and promote confidence and resilience against cyber risks.
As the financial sector adapts to these regulatory changes, collaboration between stakeholders will be critical to mitigating cybersecurity risks and promoting a safe digital environment for all users. By prioritizing cybersecurity measures, the Nigerian financial industry can become more reliable, innovative, and resilient in the face of evolving cyber threats.
