By Joy Yesufu
The Federal Government has directed all banks, fintech companies, and electronic money operators to begin collecting and remitting a 7.5 per cent Value Added Tax (VAT) on selected electronic banking services from Monday, January 19, 2026.
The directive was conveyed through customer notifications issued by payment platforms, including Moniepoint, and is in line with guidance from the Nigerian Revenue Service (NRS), formerly the Federal Inland Revenue Service.
Under the new regime, VAT will apply to service charges on electronic banking transactions such as mobile money transfers, USSD transaction fees, and card issuance fees. The tax will be calculated strictly on the service charge, not on the value of the funds being transferred.
For instance, where a bank charges N100 as a transfer fee, the applicable VAT will be 7.5 per cent of that charge.
In a notice sent to customers, Moniepoint 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. VAT will apply to certain banking services, including electronic banking charges such as mobile banking transfers, USSD transaction fees, and card issuance fees.”
Other financial institutions and payment service providers are expected to issue similar notifications to customers in the coming days.
The NRS has set the January deadline to ensure full compliance by commercial banks, microfinance banks, and electronic money operators nationwide. However, some services will remain exempt from VAT, including interest earned on savings and deposit accounts.
Moniepoint emphasised that the VAT implementation does not amount to a price increase but represents a statutory obligation imposed by the government. “Moniepoint is required by law to collect and remit VAT to the Nigerian Revenue Service,” the company clarified.
The policy forms part of the Federal Government’s broader strategy to standardise VAT collection on digital financial services and expand revenue mobilisation amid the rapid growth of Nigeria’s digital economy. While VAT on banking services is not entirely new, the NRS is now enforcing uniform application across all platforms to improve compliance.
Customers have been assured that VAT deductions will be transparently itemised, with the tax displayed separately on transaction statements and reports.
This development follows earlier notifications by several banks in December regarding the deduction of a N50 stamp duty on electronic transfers of N10,000 and above, in line with provisions of the new Tax Act.
The charge, previously referred to as the Electronic Money Transfer Levy (EMTL), has now been formally reclassified as stamp duty and is applied as a one-off fee on qualifying transactions.
