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President Bola Tinubu has instructed the Central Bank of Nigeria (CBN) to halt the enforcement of the contentious cybersecurity levy policy and initiate a comprehensive review.
This decision comes in the wake of the House of Representatives’ recent call for the CBN to retract its directive mandating all financial institutions to impose a 0.5 per cent cybersecurity levy on electronic transactions nationwide.
On May 6, 2024, the CBN issued a circular instructing banks, mobile money operators, and payment service providers to enforce a new cybersecurity levy in accordance with the Cybercrime (Prohibition, Prevention, etc) (Amendment) Act 2024.
Under the provisions of the Act, a levy equivalent to 0.5 per cent of the value of electronic transactions must be collected and remitted to the National Cybersecurity Fund, overseen by the Office of the National Security Adviser.
Financial institutions are required to apply the levy at the point of electronic transfer origination, with the deducted amount clearly labeled as “Cybersecurity Levy” in customer accounts and promptly remitted.
The implementation deadline for financial institutions to commence levy deductions is set for May 20, 2024. Subsequently, these institutions are mandated to remit the collected levies in bulk to the NCF account domiciled at the CBN by the fifth business day of each subsequent month.
Furthermore, the circular outlines specific timeframes for financial institutions to reconfigure their systems to ensure timely submission of remittance files to the Nigeria Interbank Settlement Systems Plc.
Despite these directives, concerns have been raised regarding the potential adverse effects of the levy on the cost of doing business in Nigeria and its impact on digital transaction adoption.
In response to these concerns, members of the House of Representatives have urged the CBN to withdraw the circular, citing ambiguity and the need for clarity.
Recognizing the economic implications and the burden on Nigerians, sources close to President Tinubu revealed his directive to suspend the levy and initiate a review process.
According to a senior presidency official, President Tinubu is mindful of the economic challenges faced by Nigerians and is committed to avoiding policies that exacerbate these challenges. Consequently, he has instructed the CBN to hold off on implementing the cybersecurity levy pending a thorough review.
Another presidency official highlighted discrepancies in the interpretation of the Cybersecurity Act and emphasized President Tinubu’s intention to govern with sensitivity to the needs of Nigerians. The president’s directive underscores his commitment to ensuring that government policies do not unduly burden the populace.
In light of these developments, the CBN has suspended the instruction to financial institutions to commence charging the cybersecurity levy, pending further review initiated by President Tinubu’s directive.
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