CBN Directs Banks To Charge 0.5% Cybersecurity Levy

Banks nationwide have received instructions from the Central Bank of Nigeria (CBN) to implement a 0.5% cybersecurity levy on specific transactions conducted by their clients.

The directive was issued through a circular dated May 6, 2024, which was distributed to all commercial, merchant, non-interest, and payment service banks, in addition to mobile money operators and payment service providers.

“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 (NCF), which shall be administered by the Office of the National Security Adviser (ONSA),” the circular partly read.

The apex bank said that the levy implementation would start two weeks from the circular date.

“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,” the circular said.

The central bank clarified that this fresh charge would not be imposed on activities like lending money and paying it back, distributing salaries, transferring money between accounts within one bank or across different banks for the same account holder, and moving money between customers of the same bank.

Additionally, exempted from this charge are transfers between branches of the same bank, processing cheques, Letters of Credit, funding related to banks’ recapitalization, only large-scale movements of funds from collection accounts, savings, and deposits, as well as transactions linked to long-term investments, and more.

Recall that Some of the online microfinance institutions in the nation have reportedly been prohibited by the Central Bank of Nigeria (CBN) from initiating new accounts and acquiring new clients.

The microfinance institutions affected include Moniepoint, PalmPay, Opay, PiggyVest, and Kuda, among others.

Insiders informed Peoples Gazette on Monday that this action was taken due to suspicions that these institutions were being utilized to channel cryptocurrency and manipulate the value of the naira.

The insiders claimed that the CBN saw the ban on new accounts as necessary to combat money laundering activities that have led to the naira depreciating against the dollar once again in recent times.

Nevertheless, Moniepoint announced on its platform over the weekend that it has temporarily halted new registrations for potential clients.