CBN Directs Bank To Stop Implementation Of 0.5% Cybersecurity Levy On Transactions

CBN Directs Bank To Stop Implementation Of 0.5% Cybersecurity Levy On Transactions

4 weeks ago
1 min read

The Central Bank of Nigeria (CBN) has rescinded its recent directive regarding the collection and remittance of the cybersecurity levy, mandated under the Cybercrime Prevention and Prohibition Amendment Act of 2024.

The decision announced through a revised circular dated May 17, 2024, marks a significant shift in regulatory approach just weeks after the initial directive stirred widespread controversy.

“The Central Bank of Nigeria circular dated May 6, 2024, on the cybersecurity levy is hereby withdrawn,” stated the circular signed jointly by Chibuzor Efobi and Haruna Mustafa, directors at the CBN overseeing payment systems management and financial policy and regulation, respectively.

The initial directive, issued to banks, payment service providers, and other financial institutions, had outlined procedures for collecting and remitting the levy. However, public outcry and concerns over the economic impact of such a levy quickly mounted, prompting swift action from the federal government.

“The directive for the levy’s collection was met with significant opposition nationwide,” commented a financial analyst who preferred to remain anonymous. “It raised serious concerns among stakeholders about its potential to stifle economic growth and burden financial institutions already grappling with regulatory pressures.”

READ ALSO: SERAP, BugiT, 136 Nigerians, Sue Nigerian Govt Over Cybersecurity Levy 

The controversy surrounding the levy reached a crescendo when the Federal Executive Council intervened, opting to suspend its implementation pending further review. This decision underscored the government’s commitment to balancing cybersecurity measures with economic stability.

“We acknowledge the importance of cybersecurity in today’s digital age,” remarked a government spokesperson during a press briefing. “However, we also recognize the need for thorough consultations and assessments to ensure that any regulatory measures do not inadvertently harm our financial ecosystem.”

Industry reactions to the CBN’s reversal have been mixed. While some welcomed the decision as a step towards more balanced regulatory oversight, others expressed frustration over the uncertainty it created.

“This back-and-forth on regulatory directives does little to instill confidence in the business community,” remarked a CEO of a leading fintech company. “Clarity and consistency are crucial for sustainable business operations, especially in sectors heavily reliant on digital infrastructure.”

Moving forward, stakeholders anticipate renewed discussions between regulatory bodies, financial institutions, and cybersecurity experts to formulate a revised approach that addresses both security imperatives and economic considerations.

“We need a framework that effectively safeguards against cyber threats without unduly burdening businesses,” emphasized a cybersecurity consultant involved in ongoing policy discussions. “Collaborative efforts are essential to strike the right balance and ensure that our regulatory environment fosters innovation while protecting national interests.”

As Nigeria navigates the complexities of digital transformation and cybersecurity challenges, the recent developments surrounding the cybersecurity levy highlight the delicate balance between regulatory oversight and economic pragmatism. The decision to withdraw the directive reflects a responsive approach to public feedback and underscores the evolving nature of regulatory frameworks in a rapidly changing technological landscape.

For now, stakeholders await further guidance from regulatory authorities on the future direction of cybersecurity policies, hopeful for a balanced approach that promotes both security and economic growth in Nigeria’s digital economy.

Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.

Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.

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