BANKS ANNOUNCE 7.5% VAT ON MOBILE MONEY TRANSFERS AND POS TRANSACTIONS

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By: Fasasi Hammad

Banks will begin deducting a 7.5 percent value-added tax (VAT) on selected banking services, including point-of-sale (POS) transaction fees and mobile banking transfer charges, starting January 19, 2026.

In a notice to customers, Moniepoint Microfinance Bank explained that the move is in line with a government-endorsed regulatory directive. The bank clarified that the VAT is applied to the N50 stamp duty and does not affect the actual amounts being transferred or withdrawn. Proceeds from the tax will be remitted to the Nigerian Revenue Service (NRS).

“From Monday, 19 January 2026, we are required to collect a 7.5% VAT on certain banking services, including POS transaction fees, mobile banking transfer fees, USSD transactions, POS activation, card issuance, and Moniebook subscriptions,” Moniepoint stated.

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The bank also noted that VAT will apply to other fees such as loan processing and documentation fees. However, services like interest on loans or savings accounts are exempt.

Moniepoint emphasized that this is not a price increase; the bank is mandated to collect and remit VAT to the NRS. All financial institutions—including commercial banks, microfinance banks, and electronic money operators—are required to comply by the January 19 deadline.

The new regulation retains the VAT rate at 7.5 percent, and the charge will appear separately on transaction reports and statements.