Babatunji Wusu –
The Central Bank of Nigeria’s (CBN) cybersecurity levy has sparked discussion over its impact on Nigerians.
The apex bank declared in an official publication on Monday, May 6, that the newly implemented cybersecurity levy complies with the provisions of the recently updated Cybercrime (Prohibition, Prevention, etc.) Act 2024.
The instruction, which is specified in a circular, states that the levy should be levied at the point of electronic transfer origination, with the deducted amount shown in the customer’s account as “Cybersecurity Levy.”
Financial institutions must therefore begin deducting within two weeks of the circular’s date and return the collected levies monthly to the National Cybersecurity Fund (NCF), which is managed by the Office of the National Security Adviser (ONSA).
Increased Burden
According to Naija News, critics believe that the charge increases the financial burden on Nigerians who are already struggling with economic hardship and excessive inflation. They point out that it applies to business transactions, affecting their capital even before accounting for earnings.
It is worth mentioning that the bank transaction charge may deter people from using banks, thwarting the government’s efforts to promote financial inclusion. If more people engage in informal transactions, it may become more difficult to regulate inflation.
However, some citizens believe that the cybersecurity levy provides benefits.
Supporters of the CBN idea believe that the tax provides a dedicated funding source for cybersecurity improvements, perhaps leading to greater protection against cybercrime, which costs Nigeria millions of dollars each year.
The fee is expected to generate significant cash for the government, which might be used for broader economic development.
Overall, it is unclear how the Cybersecurity Levy will affect Nigerians. Its efficacy is determined by how the cash raised are used and whether it discourages Nigerians from utilizing the formal banking system.
Following is a breakdown of the 0.5% Cybersecurity Levy as applied to electronic transactions:
For a ₦1,000 transfer, a ₦5 levy applies, while a ₦10,000 transfer costs ₦50.
It is important to note that, in addition to the cybersecurity levy, other charges may apply based on the transaction type and bank.
Naija News learns that banks may levy their own transfer fees based on the amount sent. Prices normally range from ₦10 to ₦50. This includes stamp duty—an additional ₦50 tax applies to electronic transactions of ₦10,000 or more. Some banks may charge ₦4 for transaction-related SMS notifications.
Cost Of Electronic Transactions Upon Implementation of Cybersecurity Levy according to statisense:
Cybersecurity Levy: SENDERS now bear.
₦5 on ₦1,000
₦50 on ₦10,000
₦500 on ₦100,000
₦5,000 on ₦1,000,000
₦50,000 on ₦10,000,000Stamp Duty: RECEIVERS bear:
₦50 on ₦10,000
₦50 on ₦100,000
₦50 on ₦1,000,000
₦50 on ₦10,000,000Transfer Fees: SENDERS bear:
₦10 on ≤₦5,000
₦25 on ₦5,001 — ₦50,000
₦50 on >₦50,000Value Added Tax: SENDERS bear:
₦0.75 on ₦10 Transfer fee
₦1.875 on ₦25 Transfer fee
₦3.75 on ₦50 Transfer feeSMS Fee: SENDERS & RECEIVERS bear:
₦4 on each electronic transfer notificationAll applicable on eligible electronic transactions.
