Everything you need to know about CBN’s new Cybersecurity levy

The Central Bank of Nigeria just issued an order to all banks operating within the country to impose a cybersecurity levy on transactions.

In a circular released on Monday, the apex bank stated that the implementation of the levy would begin two weeks from the May 6 date of the circular.

The circular was directed to all commercial, merchant, non-interest, and payment service banks.

Levy

The levy is 0.5% (half a percent) of the electronic transaction value. It applies to transactions specified in the Second Schedule of the Cybercrime (Prohibition, Prevention, etc.) (Amendment) Act, 2024.

How it works

The levy is paid by the originator of the electronic transaction and withheld by the financial institution. The deducted amount will appear on the customer’s bill with the text: “Cybersecurity Levy.”

Transfer

Financial institutions will remit collected levies to the National Cybersecurity Fund, administered by the Office of the National Security Adviser.

Exemptions

List of exemptions from cybersecurity charges are as follows:

1. Loan disbursements and repayments
2. Salary payments
3. Intra-account transfers within the same bank or between different banks for the same customer
4. Intra-bank transfers between customers of the same bank
5. Other Financial Institutions (OFIs) instructions to their correspondent
6. Banks Interbank placements
7. Banks’ transfers to CBN and vice-versa
8. Inter-branch transfers within a bank
9. Cheques clearing and settlements
10. Letters of Credits (LCs)
11. Banks’ recapitalization related funding – only bulk funds movement from collection accounts
12. Savings and deposits including transactions involving long-term investments such as Treasury Bills, Bonds, and Commercial Papers.
13. Government Social Welfare Programs transactions e.g. Pension payments
14. Non-profit and charitable transactions including donations to registered nonprofit organisations or charities.
15. Educational Institutions transactions, including tuition payments and other transaction involving schools, universities, or other educational institutions.
16. Transactions involving 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.