On May 6, 2024, the Central Bank of Nigeria (CBN) ordered banks to begin the process of deducting cybersecurity levy which will be administered by the Office of the National Security Adviser (NSA).
This was disclosed in a circular to different categories of banks, mobile money operators, payment service providers and others signed by the apex bank’s Director of Payments Systems Management, Chibuzor Efobi, and Director of Financial Policy and Regulation, Haruna B. Mustafa.
According to the circular, the deduction and collection of the cyber security levy is sequel to the enactment of the 2024 Cybercrime (prohibition, prevention etc) Amendment Act of 2024, which provides for a 0.5% deduction of the value of all electronic transactions to the National Cyber Security Fund, which would be administered by the office of the NSA.
Furthermore, the circular noted that the deduction would be described as Cybersecurity Levy and the relevant financial institutions should begin deduction in two weeks following the secular.
It stated,
With the announcement of the levy, some Nigerians are wondering whether the rate to be deducted is 0.005% or 0.5%.
The confusion is due to the provisions of the repealed Cybercrimes (prohibition, prevention, etc) Act, 2015 as well as a 2018 CBN circular, which stated the rate as 0.005%.
Also, Section 44 (2) (a) of the repealed act noted “a levy of 0.005 of all electronic transactions by the businesses specified in the second schedule of this act”, which is expected to be credited into the “National Cyber Security Fund”.
In a 2018 CBN circular in March 2018, the apex bank said “All banks are hereby directed to comply with the statutory provision for the collection and remittance of the 0.005% levy on all electronic transactions by the businesses specified in the second schedule of the Cybercrime (Prohibition, Prevention, etc.) Act.”
The 2015 Act is currently being replaced by the Cybercrimes (prohibition, prevention, etc) (Amendment) Act, 2024.
In the new act, the provisions of Section 44 of the principal act were amended, nullifying the previous regulation.
The amended act did not only state the decimal value of the levy (0.005) like the previous one, but it also introduced the percentage equivalent (0.5%) of the levy. Therefore, the levy is not 0.005% but 0.5%.
TheWitness earlier reported that the National Security Adviser, Mr. Nuhu Ribadu, had said that the Federal Government was putting measures in place to amend the 2015 Cybercrimes Act to cater to issues emanating from emerging technologies such as AI. Ribadu also directed the full implementation of the Cybercrimes (Prohibition, Prevention, etc.) Amendment Act 2024.
However, the CBN also noted that there are 16 banking transactions exempted from the new cybersecurity levy, including loan disbursements repayments and salary payments, among others.
Speaking with TheWitness, a legal practitioner based in Abuja, Damilola Victoria Alabi, said:
She further noted the complications around the exemptions, saying:
