Understanding the CBN’s 0.5 per cent cybersecurity levy directive

The Central Bank of Nigeria (CBN) has issued a directive requiring banks and financial institutions to implement a 0.5 per cent levy on certain transactions as part of the Cybersecurity Act.

This levy is aimed at bolstering cybersecurity measures within the financial sector. However, it’s important to note that not all transactions will be subject to this levy.

Here’s a breakdown of the exempted transactions:

1. Loan disbursements and repayments: Transactions related to loans are exempt from the cybersecurity levy.
2. Salary payments: Payments made as salaries to employees are not subject to the levy.
3. Intra-account transfers: Transfers made within the same bank or between different banks for the same customer are exempt.
4. Interbank placements: Transactions involving interbank placements are not included in the levy.
5. Cheque clearing and settlements: Clearing and settlement processes for cheques are exempt from the levy.
6. Government Social Welfare Programmes transactions: Payments related to government social welfare programs, such as pension payments, are exempt.
7. Educational institutions’ transactions: Transactions involving educational institutions, including tuition payments, are exempt from the levy.
8. Non-profit and charitable transactions: Donations to registered non-profit organizations or charities are not subject to the levy.
9. Transactions involving the bank’s internal accounts: Various internal transactions within banks, such as suspense accounts and reserve accounts, are exempt.

These exemptions are intended to ensure that essential financial activities remain unaffected while strengthening cybersecurity measures across the sector.