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Mixed reactions trail CBN’s charges on cash deposits, withdrawals

Mixed reactions have continued to trail Central Bank of Nigeria (CBN) reintroduction of finance bank charges on certain categories of cash deposits and withdrawals.

In a circular signed by Director, Banking and Payments System Department, CBN, Mr. Dipo Fatokun, to all Deposit Money Banks, it said the decision to reintroduce the charges on cash deposits was part of the review of charges on deposits and withdrawals under the cashless policy.

The recent Bankers’ Committee meeting decision was that the cashless policy should be extended to the remaining 30 states of the federation with imposed charges of 1.5 per cent and two per cent on deposits and withdrawals above N500,000- N1 million on existing states.

In a swift reaction, the President, Bank Customers Association of Nigeria (BCAN) and former Registrar, Chartered Institute of Bankers of Nigeria (CIBN), Dr Uju Ogubunka, during the weekend explained to Nigerian NewsDirect that banks were not established to charge customers.

According to him, “Banks in the past have been charging customers. CBN is increasing or reintroducing the threshold. Many of us felt it is not right and I believe it is not right to charge bank customers that want to deposit or withdraw money, especially when CBN is talking about finance inclusion and finance illiteracy.

“The importance of finance inclusion is to bring more customers into the saving culture but with multiple charges, it might discourage depositors.  When CBN starts charging customers, it is expected they withdraw their money and invest in other things.”

He noted CBN had introduced series of charges in the past to drive cashless society.

“The charges were an attempt to compel bank customers to oblige. Nobody can say it is right because the money belongs to customer. Yet, banks collect other charges that include Account Maintenance Fee, among others,” he said.

In its opinion, the Managing Director, Cowry Asset Management Limited, Mr. Johnson Chukwu, said the policy would drastically reduce money laundry in the financial sector and reduce movement of cash.

Chukwu said, “The cashless policy has been on for 10 years and was suspended at some point. The charges also were suspended. I think one of the reasons it was suspended was to allow roll out of technology to support the innovation.

“Today, we have advanced technology across the country to handle cashless policy of CBN. The CBN resuming the cashless policy is good and it will drastically reduce money laundering in the financial sector.

“It will be easy to control illicit funds including funds that go to kidnappers especially. I think it is a good thing CBN will resume the charges effective from April.”

He noted that the charges would encourage financial inclusion, given a reduced volume of cash in the banking system.

“I want to think the new charges will encourage bank customers to adopt electronic-banking system,” he explained.

According to the circular,

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