The Central Bank of Nigeria (CBN) has directed banks to implement a 0.5 percent cybersecurity levy on all electronic transfers in line with the Cybercrime (Prohibition, Prevention, etc) (Amendment) Act 2024.
In a circular signed by the Director of Payments System Management, Chibuzor Efobi, and Director of Financial Policy and Regulation, Haruna Mustafa, the apex bank said the levy implementation would flag-off in the next two weeks.
The circular, sent to all commercial, merchant, non-interest, and payment service banks, said it was a follow-up on an earlier letter dated June 25, 2018 (Ref: BPS/DIR/GEN/CIR/05/008) and October 5, 2018 (Ref: BSD/DIR/GEN/LAB/11/023), respectively, on compliance with the Cybercrimes (Prohibition, Prevention, Etc.) Act 2015.
The CBN further explained that the deduction and collection of the cybersecurity levy is a sequel to the enactment of the 2024 Cybercrime (prohibition, prevention, etc) Amendment Act of 2024.
Specifically referring to recent public engagements by the Office of the National Security Adviser on the above subject, the apex Bank said; “Following the enactment of the Cybercrime (Prohibition, Prevention, etc) (Amendment) Act 2024 and under 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).”
According to the circular; “Deductions shall commence within two (2) 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 5th business day of every subsequent month.”
“Finally, all institutions under the regulatory purview of the CBN are hereby directed to note and comply with the provisions of the Act and this circular.”
However, categories of transactions exempted from the levy include loan disbursements and repayments, salary payments, intra-account transfers within the same bank or between different banks for the same customer, and intra-bank transfers between customers of the same bank.
Among others also exempted from the levy are inter-branch transfers within a bank, cheque clearing and settlements, Letters of Credits, Banks’ recapitalization-related funding only bulk funds movement from collection accounts, savings, and deposits including transactions involving long-term investments.
To ensure effective compliance with the directive, the CBN warned that failure to remit the levy is an offence that attracts a fine of not less than two (2) percent of the annual turnover of the defaulting business, amongst others.
As part of its efforts at sanitizing the nation’s financial sector, the CBN recently issued a directive barring fintechs from onboarding new customers, even as the Fintech firms have warned their customers against engaging in crypto transactions on their platforms.
Meanwhile, this latest directive is coming just less than a week after the Federal Government instructed banks to immediately commence the deduction of a 0.375 percent stamp duty charge on all mortgaged-backed loans and bonds.
