Lagos, Nigeria – September 19, 2024
In a significant policy shift, the Central Bank of Nigeria (CBN) has reduced the cybersecurity levy on electronic transactions from 0.5 percent to 0.005 percent, according to its new fiscal guidelines for 2024-2025. This adjustment comes after considerable controversy and opposition from various stakeholders, including the Nigeria Labour Congress (NLC), Trade Union Congress (TUC), and bank customers.
The CBN’s revised directive, issued on Wednesday, states, “The CBN shall continue to enforce the payment of the mandatory levy of 0.005 percent on all electronic transactions by banks and other financial institutions, by the Cybercrime (Prohibition, Prevention, etc.) Act, 2015.”
The levy, which was introduced under the amended Cybercrime (Prohibition, Prevention, etc.) Act 2015, is intended to support the National Cybersecurity Fund managed by the Office of the National Security Adviser. The reduced fee will apply to transactions conducted by various financial entities, including commercial, merchant, non-interest, and payment service banks.
However, the new guidelines specify that certain transactions will be exempt from the levy. These include wage payments, loan disbursements and repayments, intra-bank transfers, clearing and settlement of cheques, Letters of Credit, and transactions between banks and the CBN.
The introduction of the cybersecurity levy earlier this year sparked widespread protests, prompting President Bola Tinubu to order a suspension and review of the policy. The House of Representatives also called for its immediate withdrawal. Despite the backlash, the CBN has decided to proceed with the levy at the significantly reduced rate as part of its monetary and exchange policy for the upcoming fiscal years.
In related news, the CBN has recently made headlines for maintaining its 5% ways and means advance limit despite defying the National Assembly and for giving Point of Sale (PoS) operators a one-month deadline to use aggregators.
The decision to lower the levy is seen as a response to public outcry and an effort to address concerns over the impact of the original rate on electronic transactions and financial inclusion.