7th May, 2024
By Ayorinde Oluokun/Abuja
The Central Bank of Nigeria (CBN) on Monday asked banks and other financial institutions to put in place a process for implementing a 0.5 per cent cybersecurity levy on electronic transfers.
The CBN circular signed by Chibuzor Efobi, director of payments system management and Haruna Mustafa, director of financial policy and regulation on Monday was issued to commercial, merchant, non-interest and payment service banks, as well as mobile money operators.
According to the apex bank, the policy would take effect in two weeks and charges would be described as ‘Cybersecurity Levy’.
CBN said the deduction and collection of the cybersecurity levy is a sequel to the enactment of the Cybercrime (prohibition, prevention etc) Amendment Act of 2024.
“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),” CBN said.
The circular was follow-up on an earlier letter dated June 25, 2018 (Ref: BPS/DIR/GEN/CIR/05/008) and October 5, 2018 (Ref:
SD/DIR/GEN/LAB/11/023), in compliance with the Cybercrimes (Prohibition, Prevention, Etc.) Act 2015.
The charges would be remitted to the national cyber security fund, which would be administered by the office of the NSA, CBN said.
The apex bank said failure to remit the levy is an offence which attracts a fine of not less than 2 percent of the annual turnover of the defaulting business, amongst others.
“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.”
CBN said the deductions will begin within two weeks from May 6 and financial institutions must pay the collected levies by the fifth business day of the following month.
However, some items were exempted from the 0.5 per cent Cybersecurity levy on all electronic transactions by the CBN
The circular exempted some transactions from cybercrime levy.
Transactions exempted include 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 Financial Institutions (OFIs) instructions to their correspondent banks.
The exemption also applies to interbank placements, banks’ transfers to CBN and vice versa, inter-branch transfers within a bank, cheque clearing and settlements, and Letters of Credit (LCs).
Others include banks’ recapitalisation-related funding only bulk funds movement from collection accounts; savings and deposits including transactions involving long-term investments such as treasury bills, bonds; and commercial papers; government social welfare programmes transactions, e.g. pension payments; non-profit and charitable transactions including donations to registered non-profit organisations or charities; educational institutions transactions, including tuition payments and other transaction involving schools, universities, or other educational institutions.
Transactions involving the bank’s internal accounts, such as suspense accounts, clearing accounts, profit and loss accounts, inter-branch accounts, reserve accounts, nostro and vostro accounts, and escrow accounts, are also exempted from the levy.