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The Nigerian Government has directed banks and fintech companies to begin collecting and remitting a 7.5 per cent value-added tax (VAT) on selected electronic banking service fees.
The directive is expected to take effect from Monday, January 19, 2026.
Payment platforms have started notifying customers of the change. In an email circulated on Wednesday, Moniepoint informed users that VAT would apply to electronic banking charges, including mobile money transfers, USSD transaction fees, and card issuance fees.
The tax will be charged on the service fee itself, not on the amount being transferred. For instance, where a transfer attracts a ₦100 charge, the 7.5 per cent VAT will be applied to that ₦100 fee.
According to the notice, banks and fintech operators are now required to collect the tax and remit it to the Nigerian Revenue Service (NRS), formerly known as the Federal Inland Revenue Service. Similar notifications are expected from other financial service providers in the coming days.
Certain services will remain exempt from VAT, including interest earned on deposits and savings, meaning customers will not be taxed on returns from their accounts.
The NRS has set a compliance deadline for all commercial banks, microfinance banks and electronic money operators to ensure full implementation of the collection and remittance requirement.
Moniepoint clarified that the VAT implementation does not amount to a price increase but reflects a statutory obligation placed on financial institutions to collect and remit the tax to the revenue authority.
The directive aligns with the Nigerian Government’s wider effort to harmonise VAT collection across digital financial services, as it seeks to strengthen revenue mobilisation in line with the rapid expansion of Nigeria’s digital economy.
Although VAT has previously applied to certain banking transactions, the Nigerian Revenue Service is now tightening enforcement by mandating uniform application of the tax across all financial platforms to close compliance gaps within the sector.
Customers have also been assured that the VAT will be transparently applied, with charges clearly broken out and shown separately on transaction receipts, statements, and account reports.
The development follows earlier notifications by several commercial banks in December, informing customers of a ₦50 stamp duty charge on electronic transfers of ₦10,000 and above, in line with provisions of the new Tax Act. The charge, previously referred to as the Electronic Money Transfer Levy, has since been formally reclassified as stamp duty and applies as a one-off fee on qualifying transfers
