Customers of financial institutions across Nigeria will begin to see Value Added Tax (VAT) charges on selected banking and electronic transaction services starting Monday, January 19, 2026, following a government-endorsed regulatory directive.
Under the new requirement, a 7.5 percent VAT will be collected on specific banking and service-related charges and remitted to the Nigerian Revenue Service (NRS), formerly known as the Federal Inland Revenue Service. The directive applies to all financial institutions, including commercial banks, microfinance banks, and electronic money transfer operators.
According to the notice, VAT will be charged on electronic banking services such as Point of Sale (POS) transaction fees, mobile banking transfer fees, USSD transaction charges, POS activation fees, card issuance fees, and Moniebook subscription fees. Other applicable charges include loan processing and documentation fees.
However, certain financial services remain exempt from VAT. These include interest on loans and advances, as well as interest earned on deposits and savings.
Clarifying the development, Moniepoint stated that the VAT charge does not represent a price increase in its services but is a statutory obligation imposed by the federal government. The company explained that it is required by law to collect the tax on behalf of the NRS and remit it accordingly.
The NRS has set January 19, 2026, as the compliance deadline for all affected institutions to begin the collection and remittance of VAT on eligible transactions.
Customers are advised that VAT will be applied only to service and banking fees, not to interest payments, and that the VAT charge will be clearly itemised and displayed separately on transaction reports and account statements.
The development forms part of broader efforts by the federal government to strengthen tax compliance and improve revenue collection within Nigeria’s financial sector.
