We heartily welcome the Senate’s recent resolution urging the Central Bank of Nigeria (CBN) to suspend the Automated Teller Machine (ATM) card maintenance charges being deducted from customers. It is also good that the Senate called on the banks to reconfigure their machines to dispense up to N40,000 per withdrawal pending the outcome of its investigation on the matter.
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The intervention by the Upper Legislative Chamber came on the heels of a motion on the illicit and excessive bank charges on customers’ accounts, sponsored by Senator Olugbenga Ashafa, representing Lagos East. The Senate also directed its Committee on Banking, Insurance and other Financial Institutions to investigate the propriety of these charges and find out if they are in line with international best practices.
It mandated the Committee to invite the CBN Governor, Godwin Emefiele, to explain why the official charges approved by the apex regulator are skewed in favour of the banks as against the banks’ customers.
Currently, per withdrawal limit in some banks through the ATM card is N10,000. Undoubtedly, customers’ complaints over excessive bank charges have been on for a long time. It is, therefore, appropriate and timely that the Senate has ordered a thorough investigation of the matter.
It is sad that the commercial banks are apparently extorting their customers through sundry illegal charges. The banks should stop deducting money from customers’ accounts in the guise of maintenance charges. It is disheartening that bank customers have, at various times, been short- changed through the illegal charges. Many have had their accounts incorrectly debited by their banks, using different techniques and concepts. We recall that efforts by the Consumer Protection Council (CPC) and other consumer advocacy groups to draw attention to the illegal charges have yielded little results. Perhaps the latest move by the Senate will achieve the desired outcome.
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Many customers have taken their banks to court over excessive charges. This has eroded the trust that ought to exist between banks and their customers. It will be recalled that in March 2016, the Consumer Advocacy Foundation of Nigeria (CAFON) mobilised Nigerians on a “No Banking Day,” to protest excessive bank charges.
The fact remains that the banking industry is vital to the economic wellbeing of the country. We believe that depositors will pay reasonable charges for services rendered, but overcharging them for ATM card maintenance is unacceptable. Although the CBN increased the maintenance fees charged by banks on debit and credit card maintenance from N100 per year to N50 per month or N600 a year, but some banks are alleged to have configured their machines not to dispense more than N10,000 per withdrawal and in some cases not more than N20,000 per withdrawal. This should also be investigated. The CBN must, at all times, be on the side of bank customers on the issue of unauthorised bank charges. That is the practice in other countries.
It bears repeating that every economy is as strong as its banks. We, therefore, urge the banks to concentrate on their core duties. Nigerians need to be encouraged by the banks with services that will grow their businesses and not actions that will make them close their accounts. Today, excessive commissions are charged on almost all bank transactions.
Again, it is worth reminding the banks that in spite of the current challenging times, their performance will be measured largely by how they discharge their duties. If the banks fail to stop the excessive charges, some bank customers may resort to keeping their money outside the banking system. A return to such a practice will not be good for the economy and the government’s “cashless” policy. While the outcome of the Senate committee on the matter is being awaited, we urge the banks to suspend all illegal charges.