The Central Bank of Nigeria (CBN) has revoked its cybersecurity levy order, three days before its implementation.
On May 6, 2024, the CBN issued a circular directing all commercial banks and payment service providers to implement a compulsory withdrawal of 0.05% cybersecurity levy on all electronic transactions.
This was in accordance with the Cybercrime Prevention and Prohibition Amendment Act of 2024.
The Apex bank however withdrew this directive in a circular that was released on Sunday night, dated May 17,2024.
Signed by its Director of Payment Systems Management, Chibuzor Efobi, and Director of Financial Policy and Regulation Department, Haruna Mustafa, the circular was addressed to commercial banks, PSPs, non-interest banks, and others.
According to the circular , the bank’s earlier statement on the subject ( the May 6 circular) has been withdrawn.
It stated: “Circular to all commercial, merchant, non-interest, and payment service banks; other financial institutions, mobile money operators, and payment service providers.”
The circular reads:
Re: Cybercrimes (Prohibition, Prevention, Etc.) (Amendment) Act 2024 – Implementation Guidance on the Collection and Remittance of the National Cybersecurity Levy
“The Central Bank of Nigeria circular dated May 6, 2024 (Ref: a statement on PSMD/DIR/PUB/LAB/017/004) on the above subject refers.”
“Further to this, please be advised that the above-referenced circular is hereby withdrawn.”
According to reports, the withdrawal was due to mounting pressure from labour unions.
Financial industry experts have also condemned the imposed levy , tagging it as “regressive” .
The experts cite the resultant sharp increase in the cost of an electronic transaction amidst the country’s highest inflation rate in thirty years and a cost of living crisis.
The Cybersecurity fee
The now-revoked cybersecurity levy meant an electronic transfer of ₦1,000 would attract a ₦5 fee, while a ₦100,000 transfer would attract a ₦500 fee.
Added to a stamp duty charge, an SMS charge, and a charge from the national payment switch, a ₦10,000 electronic transaction would have cost ₦130.875.
Thankfully, the federal government has suspended the levy and said it would be reviewed on Tuesday.