It’s no longer news that the Central Bank of Nigeria has reduced all bank charges. Some charges got more than 50 percent cuts with effect from January 1, 2020, according to the apex bank. You will agree with me that the Nigerian banking industry is riled by multiple and unnecessary charges. The CBN, through the director of corporate communications, explains the decision to cut ATM, other bank charges. According to the CBN, the decision is a result of incessant public outcry against the multiplicity and value of the charges. The decision is specifically aimed at making financial services more accessible and affordable to all stakeholders. The decision is also in line with the customer-centric approach the CBN has taken recently. With the economy looming with huge charges and fees, banking services are now contained in the new guide to charges by banks, other financial and non-bank financial institutions.
The CBN stated that the new charges were only arrived at after extensive consultation with stakeholders. The new policy will be enforced to enhance flexibility, transparency, and competition in the modern banking industry. The guide stipulates that a penalty of 2-million-naira daily infraction fines will be incurred by banks and other financial institutions if they fail to comply with the new policy guidelines.
LOGGING CUSTOMER COMPLAINTS
The director of corporate communications at CBN, Isaac Okorafor, said the banks have been directed to henceforth log every complaint received from their customers into the Consumer Complaint Management System (CCMS). Additionally, they had to generate a reference code for each complaint logged. Log ID must be given to the customer. “Failure to log and provide the code to the customer amounts to a breach and is sanctionable with a penalty of 1 million naira per breach”, he said. The CBN explains the decision to cut ATM, other bank charges to emphasize the seriousness of the new policy.
According to him, “this is the time financial service providers and the customers alike have to acquaint themselves with the provisions of the guide and be guided accordingly”.
CBN CUTS CARD MAINTENANCE CHARGE
For cards linked to a savings account, the maintenance fee has been reduced to a maximum of 50 naira per quarter from 50 naira per month, amounting to only 200 Naira per annum instead of 600 naira per year
Current accounts are now free from Card Maintenance Fee (CAMF). The guide also pegs a maximum of N1 per mille for customer-induced debit transactions on current accounts to third parties and lodgments to customers’ current accounts in other banks. At least, to an extent, this will help most of us to organize our purse, as prescribed here.
CHARGE ON CASH WITHDRAWALS VIA ATM
CBN further explains the decision to cut charges on ATM withdrawals on other banks. Cash withdrawals from other banks’ Automated Teller Machines (ATM) will now only attract a charge of N35 instead of N65 from the third off-us ATM withdrawal in the month. That means, after the first three FREE withdrawals, you will be charged N35 each time you withdraw from another bank’s ATM, instead of N65. This is laudable.
CHARGE ON BANK GUARANTEES AND OTHER BANK FACILITIES
Other reductions include Bank Guarantees e.g Bank Guarantee (BG), Bank Acceptance (BA), Advance Payment Guarantee (APG) charges, etc which is now pegged at a maximum of 1% of the APG value in the first year and 0.5% for subsequent years on contingent liabilities.
CHARGE ON DEBIT/CREDIT CARD ISSUANCE
CBN further explains the decision to cut ATM card issuance charge, a one-off charge of N1000 applies to the issuance irrespective of card type. Same one-off charge of N1000 shall be applied for replacement due to loss, expiration or damage of charge issued earlier. However, prepaid card loading and unloading shall now be treated at NO-CHARGE.
Okorafor further explained that the current NIBBS Instant Payment (NIP) charges applied to the use of Unstructured Supplementary Service Data (USSD), as purchase with cash-back will attract a charge of N100 per N20,000. This is still subject to cumulative N60,000 daily withdrawal.
CHARGE ON ACCOUNT REACTIVATION
The CBN further explains the decision to cut ATM, other bank charges such as reactivation of dormant accounts. There will be no more charges for reactivation or closure of accounts such as savings, current and domiciliary accounts. Accounts that have gone inactive or dormant can now be reactivated without any fee incurred to the account holder at the instance of reactivation.
CHARGE ON REFERENCE LETTERS, CONFIRMATION LETTERS AND LETTERS ON NON-INDEBTEDNESS
Account Status Inquiries at customer request e.g Confirmation Letter, Letter of Non-Indebtedness, and Reference Letter will now only attract the fixed fee of N500 per request.