Banks to charge 7.5 VAT on mobile transfer, PoS transaction fees

Banks will start deducting 7.5 percent value-added tax (VAT)on banking services, including point of sale (POS) transaction fees, mobilebanking transfer fees, from January 19. In an email to customers, Moniepoint Microfinance Bank saidthe charge stems from a government-endorsed regulatory change. VAT is charged on the N50stamp duty and does not affect the actual amount being transferred orwithdrawn. According to the bank, the proceeds of the charge will beremitted to the Nigerian Revenue Service (NRS). “We would like to inform you of an upcominggovernment-endorsed regulatory change regarding Value Added Tax (VAT),”Moniepoint said. “From Monday, 19 January 2026, we are required to collect a7.5% VAT, to be remitted to the Nigerian Revenue Service (NRS) (formerly knownas the Federal Inland Revenue Service). “VAT will apply to certain banking services that include:electronic banking charges such as POS transaction fees, mobile banking fees(transfers), USSD transaction fees, POS activation fee, card issuance fee andMoniebook subscription.” According to the bank, the charge also applies to otherfees, such as loan processing and documentation fees. “Services that DO NOT attract VAT include: interest on loansand advances, and interest on deposits and savings,” Moniepoint said. “Please note: This is not a price increase by Moniepoint.Moniepoint is required to collect and remit VAT to the Nigerian Revenue Service(NRS). “The NRS has communicated a deadline of 19th January for allfinancial institutions (commercial banks, microfinance banks and electronicmoney transfer operators) to start collecting and remitting VAT.” The bank clarified that VAT applies only to banking orservice fees and not to interest, adding that the charge will be listedseparately on transaction reports and statements. The new tax laws retain the VAT rate at 7.5 percent.

Read More