CBN Mandates 0.5% Cybersecurity Fee on Transaction
The Central Bank of Nigeria (CBN) has issued a directive mandating all banks and other financial institutions to implement a 0.5% cybersecurity levy on all electronic transactions. This measure, effective from May 20, 2024, is aimed at enhancing the cybersecurity of Nigeria’s financial sector amidst growing cyber threats. The funds collected through this levy will be remitted to the National Cybersecurity Fund (NCF), which is administered by the Office of the National Security Adviser.
Key Points:
- Levy Rate: A 0.5% levy will be applied on the value of all electronic transactions as specified under the provisions of Section 44 (2)(a) of the Cybercrime (Prohibition, Prevention, etc.) (Amendment) Act 2024.
- Implementation Date: The directive takes effect two weeks from the date of the circular, which was issued on May 6, 2024.
- Exemptions: Certain transactions are exempted from the cybersecurity levy, including loan disbursements and repayments, salary payments, intra-account transfers within the same bank or between different banks for the same customer, intra-bank transfers between customers of the same bank, and other specified financial transactions.
- Remittance: The levy will be deducted at the point of electronic transfer origination and will be remitted to the National Cybersecurity Fund (NCF) by the fifth business day of the subsequent month.
- Penalties for Non-compliance: Failure to remit the collected levies may attract severe penalties, including a fine of up to 2% of the annual turnover of the defaulting financial institution.
Public and Expert Reactions:
Public and expert reactions to the new cybersecurity levy have been mixed. Some individuals and organizations have expressed concerns about the additional financial burden this levy places on consumers and businesses, especially given the challenging economic conditions. Others have welcomed the move as necessary to ensure the security and stability of Nigeria’s financial sector in the face of growing cyber threats.
