The Federal Government has issued a directive requiring all deposit money banks and financial technology companies to collect and remit a 7.5 per cent Value-Added Tax on specific electronic banking services, beginning Monday, January 19, 2026.
The mandate was communicated to customers via email notices from payment service platforms, including a widely circulated notice from fintech operator Moniepoint on Wednesday.
According to the directive, the VAT will be levied on the service charges for a range of electronic transactions. These include Mobile money transfer fees, USSD transaction charges and Card issuance and maintenance feesCrucially, the tax applies only to the service fee itself, not the principal amount of any transaction.
For illustration, if a customer is charged N100 for a bank transfer, an additional N7.50 will be added as VAT, making the total service cost N107.50.“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 known as the Federal Inland Revenue Service),” the Moniepoint email stated.The notice further clarified that 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.”Financial industry sources indicate that other banks and payment operators are expected to roll out identical notifications to their customers in the coming days.
The government has specified exemptions to this new VAT enforcement. Services that will remain unaffected include interest earned on deposits and savings accounts, ensuring customers will not be taxed on the returns from their savings.
This move is seen as part of broader efforts to expand the nation’s tax base and increase revenue from the rapidly growing digital financial services sector.
