Nigerians are set to contend with higher transaction costs as a new 7.5% Value Added Tax (VAT) on selected banking services, including mobile transfers and USSD transactions, takes effect from January 19, 2026.
According to a customer notice issued by Moniepoint on Wednesday, the directive comes from the Nigerian Revenue Service (NRS), which has mandated financial institutions to begin VAT collection and remittance on specified electronic services.
“From Monday, 19 January 2026, we are required to collect a 7.5 per cent VAT, to be remitted to the Nigerian Revenue Service (NRS),” the notice stated.
The announcement follows earlier changes under the Nigerian Tax Act, effective January 1, 2026, which shifted the burden of the ₦50 electronic transfer levy (on transactions of ₦10,000 and above) from recipients to senders.
Banks have since begun notifying customers, stressing that the deductions are regulatory requirements rather than new fees.
Access Bank, in its own communication, explained that levies would “no longer be charged to the recipient but will now be deducted from the sender’s account,” with all proceeds remitted to the Federal Government.
Public Reaction
While the amounts may appear modest, the combined effect of VAT, transfer levies, and existing bank charges has triggered widespread criticism.
Many Nigerians argue that the changes further squeeze household finances already strained by inflation and currency depreciation.
For years, recipients bore the levy, often receiving less than the amount sent. From 2026, recipients will now get the full transfer value—a welcome relief for salary earners, traders, and families dependent on remittances.
However, the visibility of deductions on the sender’s side has amplified public discontent.
On social media, users have described the policy as another example of “hidden taxes becoming explicit” in Nigeria’s digital economy.
Some fear the added friction could push people back toward cash transactions, undermining progress in financial inclusion.
For Nigerians abroad, the change adds another cost layer to an already expensive remittance chain.
While international transfer fees and foreign-exchange spreads remain the biggest expenses, the ₦50 levy now applies once funds are credited into Nigerian accounts—meaning overseas senders ultimately absorb the cost on qualifying transfers.
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