Value-Added Tax: What To Know About VAT Fee For Banking Services

Value-Added Tax: What to know about VAT fee for banking services. On Thursday, banks said they will start deducting 7.5 percent value-added tax (VAT) on banking services, including point of sale (POS) transaction fees, mobile banking transfer fees, from January 19.

In an email to customers, Moniepoint Microfinance Bank said the charge stems from a government-endorsed regulatory change, with the proceeds of the charge remitted to the Nigerian Revenue Service (NRS).

“The NRS has communicated a deadline of 19th January for all financial institutions (commercial banks, microfinance banks and electronic money transfer operators) to start collecting and remitting VAT,” the bank said.

According to the statement, the VAT is not on the actual amount sent by customers but on the service fee.

In this report, TheCable provides a breakdown of what you need to know about the development.
WHAT ARE BANKING SERVICES?

Banking services comprise various financial products and services provided by banks and other financial institutions to individuals, corporations, and government agencies.

Banks usually deduct fixed service charges from customers per transaction on such financial services

For instance, a N50 stamp duty and a N50 electronic money transfer fee is deducted from customers when an electronic transfer is made on transactions.

Such charges include electronic banking charges such as point of sale (POS) transaction fees, mobile banking fees (transfers), unstructured supplementary service data (USSD) transaction fees, and POS activation fees.

Other charges include card issuance fees, SMS alert charges, and account maintenance.

WHAT WILL BE DEDUCTED?
Banks are required to deduct VAT on eligible banking charges and remit it to the NRS.

The fee applies to the service charge, not the actual transaction amount.
For instance, on electronic transfer fee, if a customer intends to send N50,000 to a loved one, the bank deducts N50 as bank charges, the customer will pay the 7.5 percent on the bank charge.

Value-Added Tax

As a result, the 7.5 percent VAT will be applied to the N50, and not the principal amount (N50,000).
Consequently, a total amount of N50,053.75 will be deducted from the customer.

IS VAT CHARGE A NEW DEVELOPMENT?
In a statement on Thursday, the NRS said the VAT charge on banking services, fees, commissions, and electronic money transfers is not newly introduced.

“VAT has always applied to fees, commissions, and charges for services rendered by banks and other financial institutions under Nigeria’s long-established VAT regime,” the statement reads.

According to the service, the Nigeria Tax Act did not introduce VAT on banking charges, nor did it impose any new tax obligation on customers in this regard.

Governor Umo Eno Unveils Economic Empowerment Package For Windows Of Deceased Soldiers, Others

Governor Umo Eno unveils economic empowerment package for windows of deceased soldiers, others. The Akwa Ibom State Government has unveiled a comprehensive economic empowerment package aimed at improving the livelihoods of widows of fallen military, police, and paramilitary personnel through sustainable income-generating initiatives.

Governor Umo Eno announced the programme on Wednesday, during the 2026 Armed Forces Remembrance Day ceremony held at the Cenotaph on Udo Udoma Avenue, Uyo.

As part of the initiative, the state government will construct 150 lock-up stores, comprising 100 for widows of fallen military personnel and 50 for widows of deceased police officers and other paramilitary operatives.

The Governor disclosed that beneficiaries would also receive take-off grants to enable them establish and sustain small-scale businesses.

Pastor Eno explained that the intervention reflects a deliberate shift from short-term financial assistance to long-term economic empowerment for families of fallen heroes who paid the ultimate price in the service of the nation.

“In line with our commitment to the welfare of families of our fallen heroes, we are deliberately moving beyond one-off financial support to programmes that provide lasting economic stability,” the governor stated.

Beyond the empowerment package, Governor Eno also announced immediate financial support totalling N120 million in appreciation to the serving personnel, a N10 million donation to officers on parade, an additional N20 million to widows present at the ceremony, as well as another N20 million to the Nigerian Legionaries, reaffirming his administration’s tradition of recognising sacrifice and excellence.

He recalled that in the previous year, the state government disbursed N250 million as welfare support, including N150 million to widows of fallen military personnel and N100 million to widows of fallen police officers.

According to Governor Eno, construction of the lock-up stores will commence immediately after the relevant service formations make land available for the project.

He added that the Coordinator of the Office of the First Lady, the Ministry of Women Affairs, and the Bureau of Cooperatives will jointly coordinate and supervise the project to ensure prompt and timely delivery.

Speaking on national unity and politics, Governor Eno urged leaders to continue to see politics as a platform for service rather than bloodshed, commending chairmen of political parties for personally attending the remembrance event.

He expressed optimism that leaders across party lines would continue to embrace politics of ideas, development, and peaceful engagement.

On national security, the Governor commended President Bola Ahmed Tinubu, GCFR, for what he described as decisive leadership in tackling Nigeria’s security challenges, noting observable improvements across various parts of the country.

Governor Umo Eno Unveils Economic Empowerment Package

He also glowing tribute to the courage and sacrifices of officers and men of the Armed Forces who lost their lives in active service and those that are currently engaged in various theatres of operations across the nation.

Reaffirming his administration’s commitment to security agencies, Governor Eno recalled previous interventions including the completion and commissioning of internal roads at the Police Headquarters in Ikot Akpan Abia last year.

He disclosed that the Command and Control Centre would be completed soon, alongside continued provision of amenities across service formations to enhance operational effectiveness.

The Armed Forces Remembrance Day is marked annually to honour Nigerian military personnel who died in the line of duty, while also recognising the sacrifices of veterans and their families.

Governor Eno while calling on corporate organizations to support the security agencies, also called for continued peace in Akwa Ibom State and across Nigeria, stressing that the sacrifices of the nation’s fallen heroes must never be forgotten.

NSIPA Strengthen Commitment To Delivering Impactful Programmes For Vulnerable Nigerians

NSIPA strengthen commitment to delivering impactful programmes for vulnerable Nigerians The acting NSIPA CEO said this at a capacity-building workshop on Result-Driven Performance Assessment for Programme and Departmental Managers in Abuja.

Abdullahi Alhassan Imam, the acting national coordinator and chief executive officer of
The National Social Investment Programme Agency says it remains committed to delivering programmes that directly impact vulnerable Nigerians.

Mr Imam, who is also the national programme manager of the National Cash Transfer Office, said this in a statement on Thursday.

The acting NSIPA CEO said this at a capacity-building workshop on Result-Driven Performance Assessment for Programme and Departmental Managers in Abuja.

The workshop focused on reviewing and adopting the Central Results Delivery Coordinating Unit reporting framework, as applicable to the Federal Ministry of Humanitarian Affairs and Poverty Reduction and NSIPA.

It also provided a platform for identifying and validating high-impact deliverables and performance indicators expected to guide the agency’s operations in 2026.

Mr Imam, who was represented by Hamza Baba, national programme manager of the Government Enterprise and Empowerment Programme, said that the exercise was critical to improving institutional performance and ensuring measurable outcomes.

According to him, strengthening accountability and service delivery by aligning its 2026 deliverables with the federal government’s Renewed Hope Agenda.

“The CRDCU framework provides a clear structure for tracking progress, improving accountability and ensuring that presidential priorities translate into tangible results,” he said.

The head of planning, research, and statistics, Binta Ibrahim, described the CRDCU framework as a strategic tool for monitoring outcomes rather than a mere compliance requirement.
According to her, clearly defined targets and indicators are essential for assessing the effectiveness of social investment programmes across ministries, departments and agencies.

NSIPA Strengthen Commitment To Delivering Impactful Programmes

She urged participants to use the workshop to strengthen collaboration, promote innovation and enhance service delivery.

Participants resolved to finalise NSIPA’s 2026 deliverables and performance indicators for submission through the CRDCU reporting cycle and to establish follow-up mechanisms to monitor progress and address implementation gaps.

The workshop brought together programme managers, departmental heads and CRDCU focal officers, who reviewed operational challenges and developed actionable solutions to improve programme implementation.