CBN Directs Banks To Charge 0.5% cybersecurity levy on electronic transfers

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CBN to financial institutions to start the deduction of the Cyber security Levy.

Here is what you need to know in a nutshell.

1. There is a Cyber security (Prohibition, Prevention, etc) Amendment Act 2024 (An Amendment of the 2015 Act) which prescribed a levy of 0.5% of all transaction value.

2. Four days ago, the NSA directed the full implementation of the Act. This was referenced in the first paragraph of the CBN circular.

3. The fee is a debit charge on the initiator of the electronic transfer and not for the receiver of the transfer.

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4. The simple way to calculate the fee is to remove the last 3 digits of a transfer and divide it by 2. For instance, if you transfer N10,000 – Remove the last 3 figures (000) and divide the remaining figure (10) by 2. This gives you N5 as your CSL.

5. There are exemptions to the fee.
– Salary Payments are exempted
– Intra-account transfers within the same bank for the same customers are exempted
– Inter-account transfers between different banks for the same customers are exempted.
– Intra-bank transfers between customers of the same banks are exempted.
– Cheque payments are exempted
– Savings And Deposits are exempted (not sure whether this includes Savings accounts – Need To check)
– Pension Payments are exempted
– Educational Institution transactions are exempted
– Donations to NGOs are exempted. That means your tithes and offerings will not be charged.

6. This is not a bank levy. It was not initiated by the CBN. It is a Tax payable to the government. Think of it as a second AMF (Account Maintenance Fee) but this time to the government and not the bank. The CBN is just an implementation entity.