FULL LIST: 16 Banking Transactions Spared from CBN’s Cybersecurity Levy: What You Need to Know

In a recent directive issued by the Central Bank of Nigeria (CBN), all banks are mandated to implement a 0.5 per cent cybersecurity levy on electronic transactions within the country, effective two weeks from May 6, 2024. However, certain banking transactions have been exempted from this levy, as outlined by the CBN.

The directive, conveyed through a circular signed by Chibuzo Efobi, Director of Payments System Management Department, and Haruna Mustafa, Director of Financial Policy and Regulation Department, applies to all commercial, merchant, non-interest, and payment service banks. The levy will be deducted and remitted by the financial institutions at the point of electronic transfer origination, with the narration “Cybersecurity Levy” reflecting in the customer’s account.

Outlined below are the 16 banking transactions exempted from the new cybersecurity levy:

1. Loan disbursements and repayments
2. Salary payments
3. Intra-account transfers within the same bank or between different banks for the same customer
4. Intra-bank transfers between customers of the same bank
5. Other Financial Institutions instructions to their correspondent banks
6. Interbank placements
7. Banks’ transfers to CBN and vice-versa
8. Inter-branch transfers within a bank
9. Cheque clearing and settlements
10. Letters of Credits
11. Banks’ recapitalisation-related funding – only bulk funds movement from collection accounts
12. Savings and deposits, including transactions involving long-term investments such as Treasury Bills, Bonds, and Commercial Papers
13. Government Social Welfare Programmes transactions e.g. Pension payments
14. Non-profit and charitable transactions, including donations to registered non-profit organisations or charities
15. Educational institutions’ transactions, including tuition payments and other transactions involving schools, universities, or other educational institutions
16. Transactions involving bank’s internal accounts such as suspense accounts, clearing accounts, profit and loss accounts, inter-branch accounts, reserve accounts, nostro and vostro accounts, and escrow accounts.

This exemption list aims to provide clarity on transactions not subject to the new cybersecurity levy, ensuring transparency and understanding within the banking sector.