The Central Bank of Nigeria (CBN) has mandated that all banks and other financial institutions implement a cybersecurity levy on all banking transactions within two weeks.
This directive responds to the increasing need for enhanced cybersecurity measures and is backed by the recently enacted Cybercrime (Prohibition, Prevention, etc.) (Amendment) Act 2024.
According to a circular released by the CBN on Monday, the new levy amounts to 0.5%, equivalent to half a per cent of the value of all electronic transactions, as specified under the provisions of Section 44 (2)(a) of the Act.
The funds collected will be remitted to the National Cybersecurity Fund, which is administered by the Office of the National Security Adviser.
Here are the key details regarding the cybersecurity levy as outlined in the CBN circular:
1. Levy Amount: The levy imposed is 0.5% of every electronic transaction. This is aimed at bolstering the nation’s cybersecurity infrastructure.
2. Collection Method: Financial institutions will deduct the levy directly from customers’ transactions. The amount deducted will be indicated in the customer’s account statement with the description “Cybersecurity Levy.”
3. Administration and Remittance: Financial institutions are responsible for collecting the levy and remitting it to the National Cybersecurity Fund. The remittance to the NCF account, housed within the CBN, must be done in bulk monthly by the fifth business day of the subsequent month.
4. Implementation Timeline: The directive takes effect two weeks from the date of the circular, and banks must adjust their systems promptly to accommodate the new levy deduction and remittance processes.
5. Penalties for Non-compliance: Failure to remit the collected levies may attract severe penalties, including a fine of up to 2% of the annual turnover of the defaulting financial institution.
This move by the CBN aims to fortify the financial sector against cyber threats and ensure a robust framework for tackling cybercrime.
The imposition of the cybersecurity levy is expected to generate significant funds to support the country’s cybersecurity initiatives.
Financial institutions and customers alike are advised to prepare for the slight increase in transaction costs due to this new levy.
