Customers of commercial banks in Nigeria have expressed their displeasure with what they see as excessive charges on their accounts by the banks as account and card maintenance charges among others.
This is as 12 banks in the first half of this year made N120.49 billion as income realised from electronic transactions.
Last year, despite the pandemic and the downturn in economic activities, 12 commercial banks jointly made N933.16 billion in profit and made N216.52 billion from charges on electronic transactions, as customers continue to complain of excessive fees that they are being charged to make the banks richer.
Besides account and card maintenance fees, other charges that bank customers still have to contend with include: stamp duty charges, SMS alert charges, ATM charges, electronic transfer charges and so on, with many of them calling for a further downward review of the charges.
A bank customer, who expressed his irritation over the account maintenance charge which his commercial bank collects from his deposit, said: “I don’t understand the rationale behind the account maintenance fee that I am charged by my bank. What is in my bank account to be maintained? When you aggregate this charge from the millions of people that are made to pay it, the figure is huge!”
Another customer queried: “Cards are issued after payments are made by the card holders; why should commercial banks charge customers card maintenance fees of N50 plus VAT every quarter? The economy is hard enough on Nigerians, these charges need to be reviewed to reduce the cost burden of keeping accounts with the banks.”
Another bank customer, Obinna Ani, expressed concern that banks continue to deduct maintenance fees even when the account or card is not in use.
“A friend of mine who had like N100,000 in his account before he left the country came back four years later to meet an empty account. They were just deducting charges on an account that was not even in use.”
A writer, Ngozi Stanley-Obi, while noting that banks are businesses and need to make profit, however, opined that some of the charges are unnecessary.
Ifeanyi Chukwu, a videographer and editor, said on a monthly basis, his bank account takes a hit from several charges.
“I have a savings and a current account. Charges on the savings are OK, but the charges on the current account are too much. With the volume of transactions I do, I get charged not less than N10,000 monthly. The charges are mostly stamp duty charges which is from the government, and SMS alert.”
An accountant, Itoro Bassey, noted that she had received a N600 debit for SMS alert,
an amount she says is over the top. However she did not complain to the bank
because of the hassle of going into the banking hall.
Despite the criticisms and complaints, banks continue to rake in massive profits.
Between January and June this year, Zenith, Access, First Bank, Union, Fidelity, Stanbic IBTC, Wema, Unity, GTCO, Sterling, First City Monument Bank and United Bank for Africa jointly pulled in N404.22 billion in after-tax profit.
Access Bank made the highest income from electronic transactions, posting N29.91 billion during the six-month period. It was followed closely by UBA which made N29.6 billion in the same period. Zenith Bank recorded an income of N17.05 billion from electronic transactions in the first six months of the year while First Bank recorded an income of N14. 4 billion.
GTCO also made N10.49 billion from electronic transactions between January and June this year while FCMB made N6.68 billion. Sterling Bank and Union Bank had in the same period made N3.59 billion and N3.54 billion respectively.
LEADERSHIP had earlier reported that the Central Bank of Nigeria (CBN) had mentioned that efforts are being put in place to lower the cost of deploying services by banks through many services initiatives.
CBN deputy governor, Financial System Stability, Aisha Ahmad, had said a cut in bank charges was one of the factors being canvassed to achieve the financial inclusion goals in the country, even as the apex bank plans to achieve a financial inclusion target of 95 per cent by 2024.
In December 2019, CBN had revised the guide on bank charges which became effective on January 1, 2020. The revised guide boasted of major cuts in fees that banks charge their customers, one of such is the reduction in electronic transactions fees.
According to the guide, electronic transfers of N5,000 and below will have a N10 transaction cost plus Value Added Tax (VAT), transfers above N5,000 but below N50,000 now attract N25 charges plus VAT, while transfers above N50,000 attract N50 charge plus VAT.
The charges on electronic transfers had been cut from N50 which most banks were charging, as against the N65 previously charged by banks after third withdrawals on remote-on-us ATM transactions. The CBN had insisted that banks do not charge above N35 per withdrawal.
However, customers complain that they are still charged N65 and some banks make the charge on every withdrawal irrespective of whether it is the first or second in the month.
Also, maintenance charges on cards were cut from N600 spread through the year to N200, a N400 shave-off from what card holders would have to pay banks on an annual basis. This means that for cards linked to savings accounts, maintenance fee has been reduced to a maximum of N50 per quarter from N50 per month, amounting to only N200 per annum instead of N600.
Similarly, maintenance charge for foreign currency card holders was also cut to $10 or its equivalent from the previous charge of $20 yearly.
Other major changes in the charges include removal of Card Maintenance Fee (CAMF) on all cards linked to current accounts, a maximum of one naira per mile for customer-induced debit transactions to third parties and transfers or lodgements to the customers’ account in other banks on current accounts only.