By Matthew Denis, Abuja
What is better described as extortion by banks on customers is gradually becoming a norm in Nigeria’s financial sector.
This happening is making the banks richer as an estimated billions of Naira is being deducted or milked out from customers accounts on daily basis.
Analysts have attributed the excessive charges on the part of the Central Bank of Nigeria (CBN) perhaps showing negligent and nonchalant attitude towards strict supervision as a major regulator among other government agencies towards the services of these banks.
A critical survey conducted by Nigerian NewsDirect within Abuja metropolis and her suburb towns in neighboring Nasarawa and Niger states recorded feedbacks from Nigerians, expressing their bitter experiences and encounters in the hands of banks, who they accuse of exploitation.
Their concerns range from excessive deduction of bank charges for card maintenance and electronic payments to double deductions of stipulated charges on daily and monthly basis.
It would be recalled that the CBN policy on banking charges against customers for services rendered which kicked-off in January 1st, 2020 with instruction that banks slashed withdrawal fees usually charged after the third withdrawal from Automated Teller Machines (ATM) within the same month.
According to the policy, “In the new directives contained in the new Guide to Bank Charges, the CBN stated that the withdrawal fee charged for the use of other banks’ ATM has been reduced from N65 to N35.
“Card maintenance fee has been reviewed to N50 every three months (quarterly), from the initial monthly period. The guide released by the CBN contains major changes on electronic transactions’ charges in Nigeria.
“Also graduated fee scale for electronic transfers to replace the current flat fee of N50 will begin, as transfers below N10,000 will attract a maximum charge of N10; and transfers above N50,000, N50.
“Card maintenance fee on the current account has been removed as the accounts already attract maintenance fees.
“Savings accounts will now attract a card maintenance fee of N50 per quarter (three months) from N50 per month. Yearly card maintenance fee on foreign currency denominated cards is reduced to $10 from $20.
“The charge for hardware token will be on a cost-recovery basis subject to a maximum of N2,500 from the previous maximum charge of N3,500, while the fee for SMS mandatory alert will be on cost recovery from previous maximum charge of N4. Bill payment via e-channels will attract a maximum charge of N500 from 0.75 per cent of the transaction value subject to a maximum of N1,200.”
The apex bank noted that the revision of the Guide to Charges and strengthening of the Consumer Protection Regulation was necessitated by continued evolution in the financial industry over the past few years, which has spurred innovation and the introduction of new products, channels and/or participants.
Following the new directives, the CBN stated that any financial Institutions that breaches any of the provisions as contained in the new guide will pay a penalty of N2 million per infraction or as may be determined by the CBN from time to time.
It read, “Financial Institutions are to note that any breach of the provisions of this Guide carries a penalty of N2,000,000 per infraction or as may be determined by the CBN from time to time.
“Failure to comply with CBN’s directive in respect of any infraction shall attract a further penalty of N2,000,000 daily until the directive is complied with or as may be determined by the CBN from time to time.”
Some of the banks after the issuance of these guidelines sent messages to their depositors in preparedness for January 1, 2020, commencement of the new charges, which cut nearly all applicable fees by the lenders significantly.
Our correspondent gathered that these banks sent messages to customers, highlighting various aspects of the cut in the charges against customers for banking transactions, as well as affirming their readiness to comply with the rules.
When our correspondent visited some residential customers to get reactions, a civil servant, Mr. Gideon Haruna who resides at Jikwonyi area of Abuja lamented the state of banks using the opportunity of extorting customers.
He said “I bank with First Bank and early this month, I discovered that a daily deduction of N300 with a text message sent to my email that it’s for maintenance charges.
“I visited the bank and complained about it and I was told that they will resolve it within a week, but to my surprise, the charges stopped after four days deduction totaling N1,200 within refund.”
Another customer, Mrs. Cynthia Emeka who lives at Guzape area of Abuja stressed that the charges from banks is becoming unbearable as she is opting to start keeping her money at home.
Also, Kadirat Jamiu who lives in Wuse area explained that an old generation bank debited her twice for ATM card maintenance fee from her account for almost a year.
According to her, the charges were being deducted “on a lost ATM card which he has deactivated and renewed a year ago but the money is yet to be refunded.
She alleged that the bank’s branch manager at Mararaba area of Karu LG told her that the problem emanated from the deactivation of her lost card but the bank failed to refund the questionable charges.
A student, Danielle Onoja at Mpape who operates old generation bank account decried that how over N1,000 was missing in her account.
She said, “It’s painful!, my mum once sent me N5,000 on a Friday to buy a textbook. I had no ATM card and I couldn’t withdraw. They kept on debiting me all through the weekend and by Monday only N3,900 was left. You should have seen me shouting for them to close the account.
“I cannot count the number of time I suffered heartbreak from unnecessary debit from bank. Even when I don’t use the account for a month, they debit me for SMS and other frivolities charges.”
Another bank customer, Yusuf Bitrus a resident of Suleja operating with a new generation bank lamented that “every month I am being charged close to N165 to N200 for SMS alert. I went to tell them that I want to deactivate because I can’t be paying that much. I want to stick to email.”
“Asides ATM and card maintenance charges, several persons also protested other unnecessary bank charges.”
Abiodun Mustafa who lives in Lokogoma area of Abuja has called out Guarantee Trust Bank (GTBank) on charges deducted over transactions made on the counter, while Damilola Josiah, another GTBank customer complained about a N500 questionable deduction made on his account.
However, some of the banks in their reactions to the allegations directed the customers to forward them their details.
The most annoying perspective of all these complaints is that most of the banks don’t refund these charges but merely direct their customers to the Customer service units.
…NLC calls for nationwide protest over banks extortion
The Nigeria Labour Congress (NLC) has appeal to Nigerians to genuinely hold their ground and defend such unwarranted and dubious charges from the commercial banks by protesting Nationwide as the labour unions will support their grievances.
Speaking exclusively to Nigerian NewsDirect, the Director of Information of NLC in Abuja, Mr. Benson Upah said “my individual perspective is that anytime I conduct bank transaction I get charged apart from the stamp fee there is VAT among others.
“But the charges i found so ridiculous is the maintenance charges as my ATM card is with me but it’s important to know what the statutory charges are stamp fee and VAT. Other charges we’ll consider them as frivolous and intended to milk and defraud Nigerians.
According to him, a tabulation was conducted on bank charges daily on certain assumptions and realized that banks make billions of naira from those charges.
The Labour spokesman emphasized that it appears banks make more income from the charges than their core services of collecting deposits and withdraws from customers.
“We the labour force will not subscribe to these charges on the intention of taking so much from Nigerians.
“We condemn these activities from the commercial banks. However, the statutory duty to pressure or stop banks from reducing these charges resides with the CBN.
“Nigerians on their own rights can go ahead and protest on the streets against the banks and that must not always be NLC.
“They should develop the culture of protesting by carrying placards to the premise of CBN or to any branch of these banks and say excessive banks charges must stop.
“I’m not saying that the NLC will not lead the protest when the need arises but I can’t recall if there is a former complaint to NLC on banks charges. But when such complaints come apparently it will be discussed on the organs of NLC and appropriate steps will be taken.”