New VAT Applies to Transfers, USSD, Card Fees from January 19, 2026
The Federal Government has directed all banks and financial technology companies to begin charging and remitting a 7.5 per cent value-added tax (VAT) on selected electronic banking services, with the policy set to take effect from Monday, January 19, 2026.
The directive was communicated to customers through email notices issued by payment platforms, including Moniepoint, on Wednesday.
According to the notice, the VAT will apply to electronic banking service charges such as mobile money transfers, USSD transaction fees, and card issuance fees. The tax will be calculated on the service charge itself and not on the amount being transferred.
For instance, where a bank charges ₦100 as a transfer fee, the 7.5 per cent VAT will be applied to the ₦100 charge, not the total sum sent.
“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),” Moniepoint stated in its customer notification.
The company explained that VAT would apply to “certain banking services, including electronic banking charges such as mobile banking transfer fees, USSD transaction fees, and card issuance fees.”
Other banks and fintech operators are expected to issue similar notices to customers ahead of the implementation date.
However, some services will remain exempt from VAT. These include interest earned on deposits and savings, meaning customers will not be taxed on returns from their bank accounts.
The Nigerian Revenue Service (NRS), formerly the Federal Inland Revenue Service, has mandated all commercial banks, microfinance banks, and electronic money operators to comply fully with the VAT collection and remittance requirement.
Moniepoint emphasised that the VAT charge does not represent an increase in service pricing but is a statutory tax obligation.
“This is not a price increase. Moniepoint is required by law to collect and remit VAT to the Nigerian Revenue Service,” the company said.
The move is part of broader government efforts to harmonise VAT collection across digital financial services and expand revenue generation in line with the growth of Nigeria’s digital economy.
While VAT on certain banking transactions is not entirely new, authorities are now enforcing uniform compliance across all platforms to eliminate gaps in collection.
Customers have been assured that VAT charges will be clearly itemised, with the tax displayed separately on transaction receipts and account statements.
Meanwhile, in December, several commercial banks also notified customers of the deduction of a ₦50 stamp duty on electronic transfers of ₦10,000 and above, following the implementation of provisions of the new Tax Act.
The charge, previously referred to as the Electronic Money Transfer Levy (EMTL), has since been formally reclassified as stamp duty and is applied as a one-off fee on qualifying electronic transactions.
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