The Central Bank of Nigeria (CBN) has indicated its readiness to enforce the controversial cybersecurity levy, albeit at a significantly reduced rate, for the 2024-2025 fiscal year.
The levy, initially set at 0.5% but eventually reduced to 0.005%, applies to all electronic transactions and is mandated by the Cybercrime (Prohibition, Prevention, etc.) Act of 2015.
The CBN’s latest Monetary, Credit, Foreign Trade, and Exchange Policy Guidelines stipulate that banks and other financial institutions must deduct the levy from all electronic transactions.
“The CBN shall continue to enforce the payment of the mandatory levy of 0.005 percent on all electronic transactions by banks and other financial institutions, in accordance with the Cybercrime (Prohibition, Prevention, etc.) Act, 2015,” the document states.
The levy’s proceeds would go towards creating a cybersecurity fund specifically designed to bolster Nigeria’s banking sector’s defences against online attacks.
The CBN stresses the significance of cybersecurity measures and requires payment service providers (PSPs), banks, and other financial institutions (OFIs) to comply with minimal cybersecurity standards.
These standards include the appointment of Chief Information Security Officers (CISOs) to oversee cybersecurity compliance, in line with the 2022 risk-based cybersecurity framework.
“Pursuant to the circular titled ‘Issuance of Risk-based Cybersecurity Framework and Guidelines for Deposit Money Banks and Payment Service Providers’ referenced BSD/DIR/GEN/LAB/11/25, and dated October 10, 2018, issued by the CBN to combat the increasing cyber security threat in the banking industry, banks and Payment Service Providers (PSPs) are mandated to adhere to the guidelines on the risk-based cyber security framework,” the document explains.
Nigerians have voiced strong opposition to the tax, warning that it places an undue financial burden on both individuals and companies.
The Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA) and the Centre for the Promotion of Public Enterprise (CPPE) are two groups that have expressed worries about the levy’s possible effects on inflation and economic growth.
The federal government had originally suspended the levy in response to public uproar, pending further review.
The amendment act that introduced it was previously enacted by the House of Representatives, but they nevertheless demanded its suspension.
Following this, the CBN retracted the circular directing the collection of the fee.
The CBN is currently implementing the charge, albeit at a far slower rate, according to the most recent guidelines. – Nairametrics.
