10 things you need to know about the new 0.5 per cent cybersecurity charges

IDOMA VOICE reports that the Central Bank of Nigeria, CBN, has asked all banks in Nigeria to collect and remit a 0.5 per cent cyber security levy to the office of the National Security Adviser.

The apex bank disclosed this on Monday in a notice by its directors, Chibuzor Efobi Haruna Mustafa payment system management and Financial Policy and Regulation Departments. 

Here are 10 things you need to know about the new 0.5 per cent cyber security levy.

1. Mandatory Levy Implementation: All banks in Nigeria are mandated by the Central Bank of Nigeria (CBN) to collect and remit a 0.5 per cent cyber security levy to the National Security Adviser’s office.

2. Legislative Basis: The levy stems from the enactment of the 2024 Cybercrime (Prohibition, Prevention, etc.) Amendment Act, which requires a deduction of 0.5 per cent of the value of all electronic transactions for the National Cyber Security Fund.

3. Administrative Authority: The National Cyber Security Fund, where the levy will be remitted, is under the administration of the Office of the National Security Adviser (ONSA).

4. Commencement Date: Financial institutions are instructed to begin deducting the cybersecurity levy from electronic transactions within two weeks of the notice issued by the CBN.

5. Calculation Method: The levy is to be calculated based on the total electronic transfer origination, with the deducted amount subsequently remitted by the financial institution.

6. Customer Account Notation: The deducted levy amount should be clearly reflected in the customer’s account, with a specific narration indicating “Cybersecurity Levy.”

7. Penalties for Non-compliance: Failure to remit the levy as mandated by the Act is considered an offence, punishable by a fine of not less than 2 per cent of the defaulting business’s annual turnover, among other penalties outlined in Section 44 (8) of the Act.

8. Scope of Application: The levy applies to all Banks, Other Financial Institutions, and Payments Service Providers specified in the Second Schedule of the Cybercrime Amendment Act.

9. Regulatory Oversight: The implementation of the levy falls under the regulatory purview of the Central Bank of Nigeria, which issues directives to ensure compliance with the statutory requirements.

10. Policy Objectives: The introduction of the cybersecurity levy aims to bolster the nation’s cyber defense capabilities by providing adequate funding for cybersecurity initiatives and infrastructure, ultimately enhancing the protection of electronic transactions and sensitive data from cyber threats.