Nigerians to Pay 7.5% VAT on Mobile Transfers, USSD Transactions from January 19

Nigerians will begin paying a 7.5 per cent Value Added Tax (VAT) on selected banking services, including mobile bank transfers and USSD transactions, from January 19, 2026, following a directive from tax authorities.

The development was disclosed in a customer notice issued on Wednesday by digital financial service provider Moniepoint. The notice informed users that financial institutions have been instructed to commence the collection and remittance of VAT on certain electronic banking charges.

According to Moniepoint, the directive requires banks, microfinance institutions and electronic money transfer operators to deduct VAT on applicable service fees and remit it to the Nigerian Revenue Service (NRS), formerly known as the Federal Inland Revenue Service.

The company stated that the tax will apply to specific services such as mobile banking transfer fees, USSD transaction charges and card issuance fees. However, it clarified that not all banking activities will be affected, noting that interest on savings and deposits remains exempt from VAT.

Moniepoint stressed that the new deductions are not an increase in its service charges but a statutory tax obligation imposed by the government. It added that VAT will apply strictly to service fees and not to the principal amount of transactions or interest earned.

The firm also disclosed that the NRS has set January 19, 2026, as the deadline for full compliance across the financial sector.

Customers were assured that VAT deductions will be transparently displayed, with the tax shown as a separate line item on transaction reports and account statements.

The implementation is expected to affect millions of Nigerians who depend on mobile banking platforms and USSD services for daily financial transactions.