The Federal Government has ordered all banks and fintech companies to collect and remit 7.5 per cent value-added tax (VAT) on selected electronic banking services, effective Monday, January 19, 2026, according to an email notice shared by payment platforms.
VAT will apply to fees such as mobile money transfers, USSD transaction charges, and card issuance fees, and will be calculated on the service fee rather than the transaction amount. For instance, a N100 transfer fee will attract N7.50 VAT.
An email from Moniepoint to customers stated:
"From Monday, January 19, 2026, we are required to collect a 7.5 per cent VAT, to be remitted to the Nigerian Revenue Service (formerly the Federal Inland Revenue Service). VAT will apply to certain banking services that include electronic banking charges such as mobile banking fees (transfers), USSD transaction fees, and card issuance fees."
Other financial operators are expected to notify their customers similarly in the coming days. Exemptions include interest earned on deposits and savings, ensuring that returns on accounts will not be taxed.
The Nigerian Revenue Service (NRS) has set compliance deadlines for all commercial banks, microfinance banks, and electronic money operators to ensure uniform collection and remittance of VAT across the sector. Moniepoint emphasized that the move is not a price increase, but a statutory obligation.
The policy forms part of the government’s wider efforts to standardise VAT on digital financial services and boost revenue in line with Nigeria’s expanding digital economy. VAT on banking transactions has existed previously, but the NRS is now enforcing consistent rules across all platforms to ensure sector-wide compliance.
Customers have been assured that VAT charges will be clearly itemised, appearing separately on transaction statements and reports.
In December 2025, commercial banks began notifying customers that the N50 stamp duty would apply on electronic transfers of N10,000 and above, following the new Tax Act. The fee, previously called EMTL, has been formally reclassified as stamp duty and applies as a one-off charge on qualifying transfers.
Elijah Adeyemi
