New 7.5% VAT on Some Bank Charges: What Nigerians Will Notice From January 19

Banks and fintech payment platforms have informed customers that a 7.5% value-added tax will be collected on certain electronic banking service charges from Monday, January 19, 2026. The tax applies to the service fee a provider charges, not the amount you are transferring.

The VAT is expected to apply to electronic banking charges such as mobile app transfer fees, USSD transaction fees, and card-issuance charges. If your bank charges ₦100 as a transfer fee, VAT is applied to that ₦100 charge, not to the money you send. In that example, VAT is ₦7.50, and it should appear as a separate line item.

What stasure, and the digital economy is growing fast. By forcing uniform VAT collection across banks, microfinance institutions, and electronic money operators, government is trying to standardise compliance and widen the tax net.

People who do many small transfers will feel the impact more than someone who sends money once in a while. Nigerians who rely on USSD—because of feature phones, weak data, or rural coverage, already pay transaction fees. When VAT is added on top, their total cost per transfer rises.

How to manage it

Review your bank’s fee schedule and transaction receipts to confirm the charge amount and the transfer amount. Bundle payments where possible rather than making multiple small transfers. Compare channels too.

VAT on e-banking charges is a cost item. The best defence is simple: know your fees, watch your receipts, and reduce unnecessary transactions.

Also note that this VAT is different from stamp duty. Many banks already deduct a one-off ₦50 stamp duty on transfers of ₦10,000 and above. Check statements so you can separate the charges.