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The Central Bank of Nigeria (CBN) has issued a directive instructing all banks to impose a 0.5% cybersecurity levy on all electronic transactions conducted within the country. This levy aims to bolster cybersecurity measures and protect financial transactions from cyber threats.

According to a circular signed by Chibuzo Efobi, Director of Payments System Management Department, and Haruna Mustafa, Director of Financial Policy and Regulation Department, the levy will be implemented starting two weeks from Monday, May 6, 2024.

The circular, addressed to commercial, merchant, non-interest, and payment service banks, outlines the application of the levy at the point of electronic transfer origination. The deducted amount will be remitted by the financial institution and reflected in the customer’s account with the narration “Cybersecurity Levy.”

However, certain banking transactions are exempt from the cybersecurity levy. Media Talk Africa provides a comprehensive list of 16 exempted transactions, which include:

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 instructions to their correspondent banks
6. Interbank placements
7. Banks’ transfers to CBN and vice-versa
8. Inter-branch transfers within a bank
9. Cheque clearing and settlements
10. Letters of Credits
11. Banks’ recapitalisation-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 Programmes transactions e.g. Pension payments
14. Non-profit and charitable transactions, including donations to registered non-profit organisations or charities
15. Educational institutions’ transactions, including tuition payments and other transactions 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.

This exemption list provides clarity on the specific transactions that will not be subject to the newly introduced cybersecurity levy, ensuring transparency and accountability in the implementation process.