What is this 7.5% charge?
The 7.5% charge you're seeing on your account is Value Added Tax (VAT). It is a tax mandated by the Nigerian Revenue Service (NRS) — not a fee set by Kuda. Your existing Kuda fees have not changed.
From 19 January 2026, all banks and fintechs in Nigeria are legally required to collect and remit 7.5% VAT on certain banking and service-related fees.
How does VAT work with my fees?
VAT is applied to Kuda's service fees, not to the amount you're transferring or paying. Here's an example using a bank transfer:
Item | Amount |
Transfer fee (flat rate) | ₦10.00 |
VAT on that fee (7.5%) | ₦0.75 |
Total charged | ₦10.75 |
So if you transfer ₦100,000, you are not paying ₦7,500 in VAT. You're paying ₦0.75 on top of the ₦10 transfer fee.
The ₦10 transfer fee is also a flat rate — it stays the same whether you send ₦50 or ₦500,000.
Which transactions does VAT apply to?
VAT applies to these fees:
Electronic banking charges (e.g. transfers)
POS transaction and activation fees
USSD transaction fees
Card issuance fees
Subscription and service-related fees
Loan processing and documentation fees
VAT does NOT apply to:
Interest on loans or advances
Interest earned on deposits or savings
So if you notice VAT on most transactions but not a few, the ones without it are likely interest-related.
Here's what your fees look like with VAT
Fee Type | Base Fee | VAT (7.5%) | Total |
Bank transfer | ₦10 | ₦0.75 | ₦10.75 |
Pay With Kuda (POS) | 0.5% (max ₦500) | max ₦37.50 | max ₦537.50 |
Pay With Card (POS) | 0.5% (max ₦100) | max ₦7.50 | max ₦107.50 |
Pay With USSD (POS) | 1.5% (max ₦2,400) | max ₦180 | max ₦2,580 |
Pay With Transfer (POS) | ₦0 | ₦0 | ₦0 |
Common questions
Is this a Kuda price increase? No. Kuda's fees remain the same. The 7.5% VAT is a government tax that we collect and remit to the NRS on your behalf.
Why is it showing up now? The Nigerian Revenue Service issued a directive effective 19 January 2026 requiring all banks and fintechs to apply VAT to applicable service fees. This applies across the entire industry — not just Kuda.
Is the 7.5% charged on the amount I'm sending? No. It is charged on the service fee only. For example, on a transfer the VAT is 7.5% of the ₦10 fee (₦0.75), not 7.5% of your transfer amount.
What if I want to avoid the VAT? The only POS payment method with no fee at all is Pay With Transfer — no base fee means no VAT either.