Socio-Economic Rights and Accountability Project (SERAP) has urged the Federal Government to urgently reverse the 0.5% cybersecurity levy introduced by the Central Bank of Nigeria.
In a statement on X, SERAP warned that it would take legal action if the government fails to comply within 48 hours, describing the levy as an ‘imposition’ that must be immediately reversed.
SERAP stated, “The Tinubu administration must immediately withdraw the grossly unlawful CBN directive to implement section 44 of the Cybercrime Act 2024, which imposes a 0.5% ‘cybersecurity levy’ on Nigerians.
“We’ll see in court if the directive is not withdrawn within 48 hours.”
Following the enactment of the Cybercrime (Prohibition, Prevention, etc) (amendment) Act 2024 the CBN ordered deposit money banks in the country to start charging 0.5% cybersecurity levy on transactions.
This was contained in a circular dated May 6, 2024 by the apex bank to all commercial, merchant, non-interest and payment service banks as well as mobile money operators and payment service providers.
The circular was signed by Chibuzor Efobi, Director Of Payments System Management and Haruna Mustafa, Director Of Financial Policy And Regulation on Monday.
According to the circular PSM/DIR/PUB/LAB/017/004 the implementation of the levy collection would start two weeks from the date of the circular on May 20, 2024.
The circular reads, “Following the enactment of the Cybercrime (Prohibition, Prevention, etc) (amendment) Act 2024 and pursuant to 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),” the circular partly read.
“The levy shall be applied at the point of electronic transfer origination, then deducted and remitted by the financial institution. The deducted amount shall be reflected in the customer’s account with the narration, ‘Cybersecurity Levy’.
“Deductions shall commence within two weeks from the date of this circular for all financial institutions and the monthly remittance of the levies collected in bulk to the NCF account domiciled at the CBN by the fifth business day of every subsequent month,” the circular added.
Exempted from the levy 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.
Also exempted from the levy were inter-branch transfers within a bank, cheque clearing and settlements, Letters of Credits, Banks’ recapitalisation-related funding only bulk funds movement from collection accounts, savings and deposits including transactions involving long-term investments, among others.
The apex bank also threatened a 2% fine on annual turnover for defaulting banks.