Nigerian bank account holders have voiced strong dissatisfaction as financial institutions across the country commenced the deduction of a 7.5% Value Added Tax on selected electronic banking services. The move, which began in January 2026, has sparked widespread concern over the increasing cost of managing personal finances.
Mounting Financial Pressure on Account Holders
Customers report receiving multiple debit alerts for various charges, including SMS notifications, transfer fees, statutory stamp duty, and account maintenance costs, with the newly added VAT further straining already tight household budgets. Evelyn Oputa, a bank customer, shared her experience of being charged approximately N1,680 for SMS alerts in December alone, with additional increases in stamp duty and other levies noted this month.
"We are already facing difficult times, and these deductions keep piling up," Oputa stated, appealing to the government for a policy review. Another customer, Akolam Nzeh, criticized the government's focus on revenue collection over citizen welfare, demanding that tax revenues be visibly channeled into infrastructure and social services.
Bank Clarification and Regulatory Directives
A banking official, Olamide Oladehinde, clarified that the deductions are based on statutory requirements and regulatory directives. He explained that the 7.5% VAT applies specifically to the service fee attached to transactions, not the principal transfer amount.
For example, a fund transfer of N10,000 with a N10 service fee would incur a VAT charge of 75 kobo, making the total cost N10.75. The VAT is levied on services such as:
- Mobile banking transfers
- USSD transactions
- Card issuance and activation
- Point of Sale (PoS) transactions
- Loan processing fees
Despite this clarification, customers like Segun Agboola have urged the Central Bank of Nigeria (CBN) to enhance its monitoring of commercial banks to ensure transparency and prevent overcharging.
Legislative Response and Calls for Investigation
The growing discontent has reached the National Assembly. The House of Representatives has initiated plans to probe the charges imposed by commercial banks on customer accounts. This follows a motion of urgent public importance sponsored by Tolani Shagaya, a lawmaker from Kwara State.
The motion, titled “Need to Curb Arbitrary Bank Charges and Protect Nigerian Customers,” argues that many deductions from accounts are arbitrary, excessive, and lack proper explanation. The House plans to summon the CBN and major banks to appear before its committee on banking regulations.
This development underscores a significant tension between regulatory fiscal measures and the daily economic realities of ordinary Nigerians, who are calling for greater accountability and relief amidst rising living costs.
