Financial institutions have begun informing customers of a government-backed regulatory change that will require the collection of Value Added Tax (VAT) on selected banking and service fees starting Monday, January 19, 2026.

In customer notices issued by Moniepoint, the institutions said a 7.5 per cent VAT will be applied to eligible charges and remitted to the Nigerian Revenue Service (NRS), formerly known as the Federal Inland Revenue Service.

According to the fintech, the VAT will apply to a range of fee-based services, including electronic banking charges such as point-of-sale (POS) transaction fees, mobile banking transfer fees, USSD transaction charges, POS activation fees and card issuance fees. The tax will also cover certain non-interest charges, including loan processing and documentation fees.

However, the institution clarified that VAT will not be applied to interest-related income. Exempt services include interest on loans and advances, as well as interest earned on deposits and savings.

Moniepoint emphasised that the VAT implementation does not amount to a price increase by financial institutions, but reflects compliance with a regulatory directive from the tax authorities.

The NRS has reportedly set January 19, 2026, as the deadline for all financial institutions, including commercial banks, microfinance banks and electronic money transfer operators, to begin collecting and remitting VAT on applicable services.

To promote transparency, the VAT charges will be clearly itemised on customers’ transaction reports and account statements, enabling users to distinguish statutory taxes from service fees.

The move forms part of broader government efforts to strengthen tax compliance and expand the VAT base within Nigeria’s fast-growing digital financial services ecosystem.