3 banks rake N71bn from Account Maintenance fees, E-business Income in 9 months

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By Kayode Tokede

A total of three Banks generated N71 billion from customers’ ac- count maintenance fees and income generated on Electronic-business (E-business) in nine months ended September 30, 2019.

The like of Zenith Bank Plc, Guaranty Trust Bank Plc (GTBank) and United Bank for Africa Plc (UBA) had generated N69.7 billion from their customers’ current account maintenance fees and E-business income in prior nine months of 2017.

Findings by our correspondent revealed that the three banks considered generated N44.4 billion on E-business Income in nine months of this year as against N29.67 billion generated in prior nine months of 2017.

On account maintenance charges, the three banks reported 31.27 per cent drop in nine months of 2018 to N27.5 billion from N40.05 billion reported in nine months ended September 30, 2018.

According to findings, income from Automated Teller Machine (ATM), Unstructured Supple-mentary Service Data (USSD) and Point of Sales (POS) terminal contribute to banks’ hike in E-business Income generated in the period under review.

Analysts have said, stability in foreign exchange transactions is expected to boost banks E-business income.

Further breakdown revealed that, GTBank reported 11 per cent increase in account maintenance charges         to N8.4 billion from N7.5 billion reported in nine months of 2017.

The group also reported N6.77billion E-business income in nine months of 2018 from N5.6 billion in nine months of 2017.

For Zenith Bank, its account maintenance charges dropped by 48.7 per cent to N14.67 billion from N28.58 billion reported in nine months of 2017 while E-business income rose significantly by 109 per cent to N17.7 billion from       N8.4 billion reported in nine months of 2017.

In addition, UBA’s account maintenance charges rose by 13.6 per cent to N4.46 billion from N3.9 billion while E-income closed nine months of 2018 at N19.9 billion, 27.8 per cent increase over N15.6 billion reported in nine months of 2017.

The Central Bank of Nigeria (CBN) last year revised the card maintenance charges in the new guide which was released from N100 annually to N50 monthly. This means every debit or credit card holder will pay N600 annually as against the N100 being paid previously.

The new Guide to Bank Charges stipulates that banks charge N50 monthly as card maintenance fee on naira debit and credit cards, while foreign currency denominated debit and credit cards would be charged $20 or its equivalent on an annual basis.

Charges for new hardware token and for replacement was increased from N2500 to N3,500, while one time soft token is to attract a SMS charge of N4 compared to N20 that was being charged by some banks.

It however left the rate for acquiring new debit and credit card, renewal or replacement of the cards at a one off charge of N1,000, while not-on-us, which is withdrawal from other banks Automated Teller Machines (ATM), would attract a charge of N65 after the third withdrawal within a month.

The President, Bank Customers Association of Nigeria (BCAN) and former Registrar, Chartered Institute of Bankers of Nigeria (CIBN), Dr Uju Ogubunka in a chat with NewsDirect said, banks customers are not happy with excess charges.

He noted that the Senate decision to summon the CBN governor, Godwin Emefiele to explain on why it approved official charges skewed in favour of banks is a welcome development.

According to him, “The senates are bank customers and are in the position to make a law against such charges.

“My take is that, it took the senate so long to come up with their decision. This has been happening over the years and they are jus waking up now. It is better they are awake, then to sleep forever.”

The Senate last week asked its committees on Banking, Insurance & other Financial Institutions and Finance are also to investigate the propriety of ATM Card maintenance charges in comparison with international best practices and report back to the Senate.

These resolutions were sequel to a motion sponsored by Gbenga Ashafa (APC, Lagos East) on “Illicit and Excessive Charges by Nigerian Banks on customers account with particular focus on Automated Teller Machine (ATM) Maintenance and Withdrawal Charges.”

Ashafa noted there have been several complaints from Nigerians generally and on social media concerning illicit and excessive charges by commercial banks on customers’ account with particular focus on ATM maintenance charges and ATM withdrawal charges.

CBN in 2017 increased the maintenance fees charged by banks on debit and credit card maintenance from N100 a year to N50 per month (N600 a year) as contained in its “Guide to Charges by Banks and other Financial Institutions.”

Ashafa referred to a viral campaign that began on social media on September 3, where many Nigerians called for reforms of the banks.

Mr Ashafa also expressed worry that most banks have deliberately manipulated their ATM not to dispense more that N10,000 per withdrawal in some cases and in most cases not more than N20,000.

“This is a deliberate ploy to manipulate the ATM machines which are ordinarily manufactured to dispense as much as N40, 000 per transaction, in order to attract more bank charges from customers who are forced to carry out more transactions due to the manipulated machines.

“It appears the CBN is becoming insensitive to the plight of Nigerians who are already complaining of excessive charges by commercial banks. If the CBN is trying to encourage a cashless Nigeria, why should they be making it more difficult and expensive for Nigerians to do transactions,” he said.

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