Nigerians have got a reprieve following years of lamentations over arbitrary charges by commercial banks. The situation, which has resulted in apathy toward commercial banks in the country that are seen to be enriching themselves with money extorted from depositors, has discouraged Nigeria’s push for financial inclusion.
In response to the growing outcry, the Central Bank of Nigeria (CBN) has revisited its policy that allowed Money Deposit Banks (MDBs) to impose those charges on their customers.
The CBN has announced a downward review of charges for electronic banking transactions in its revised guidelines to charges by banks, other financial institutions and non-bank financial institutions, NAN reports.
A circular by Chibuzor Efobi, for the Director, Financial Policy and Regulation Department, stated that the review was in response to “further evolution in the financial industry in the last few years.”
The apex bank stated that the new guide included review of other bank charges to align with market developments.
It stated that it also comprised inclusion of new sections on accountability/responsibility and a sanction regime to directly address instances of excess unapproved, (arbitrary) charges.
It added that the revised guidelines took effect from January 1.
The CBN has the mandate to issue the guide to bank charges. The guide provides a basis for the application of charges on various products and services offered by banks and other regulated institutions under the purview of the apex bank.
The guide was first released in 2004 and revised in 2013 and 2017 due to market developments such as new innovations in products and channels, as well as new industry participants.
These are bank charges affected by the policy review.
The annual cost for foreign currency (FCY) denominated cards has been cut from $20 to $10.
ATM fees are decreased from N65 to N35 following the third withdrawal within a month.
The fee for hardware tokens will be based on cost recovery, with a maximum charge of N2,500, as opposed to the previous maximum charge of N3,500.
The fee for SMS obligatory alerts will be based on a cost recovery from the previous maximum price of N4.
Bill payments made through e-channels will incur a maximum fee of N500 based on 0.75 percent of the transaction amount up to a maximum of N1,200.
A pricing scale for electronic transfers to replace the present N50 flat cost. As a result, transactions below N5,000 would incur a maximum fee of N10; transfers between N5001 and N50,000 will incur a charge of N25; and transfers above N50,000 will incur a charge of N50.
It is believed that the new guide has become necessary in the face of the fintech boom and alternative banking services being widely adopted, which are threatening Nigeria’s traditional financial industry.
Nigerian banks recorded a drop in deposit rate in 2021, as bank customers increasingly seldom leave money in their accounts, mainly due to low interest yields and the incessant complaints of bank charges depreciating savings accounts. The situation forced some banks to review their deposit interest rates upward to attract deposits.
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