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CBN slashes bank charges; cuts ATM fee to N35 in new guide to Bank Charges

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Central Bank of Nigeria

 

…Defaulting banks to pay N2m fine

The Central Bank of Nigeria (CBN) on Sunday released revised Guide to Bank Charges mandating banks to charge customers N35 for cash withdrawals from other banks’ Automated Teller Machines (ATMs). The charge, which was reduced from previous N65 fee, applies after the third withdrawal within one month.

The new guideline signed by Chibuzo Efobi for CBN Director, Financial Policy and Regulation Department, showed a downward review for electronic banking transaction charges to align with market developments and inclusion of new sections on accountability and sanctions for defaulting banks.

The guideline, which takes effect January 1, 2020, is in furtherance of CBN’s quest to make financial services more accessible and affordable to various stakeholders in the economy.

Other major highlights of the new policy include removal of Card Maintenance Fee (CAMF) on all cards linked to current accounts, a maximum of one Naira per mille for customer induced debit transactions to third parties and transfers or lodgments to the customers’ account in other bank on current accounts only, cut in Advance Payment Guarantee (APG) now pegged at maximum of one per cent of the APG value in the first year and 0.5 per cent for subsequent years on contingent liabilities.

The charges prescribed in the guide were arrived at after extensive consultations with stakeholders and is expected to enhance flexibility, transparency and competition in the Nigerian banking industry.

CBN Director, Corporate Communications, Isaac Okorafor, explained that on debit card charges, the new guide stipulates that a one-off charge of N1,000 applies to the issuance of cards, irrespective of card type (regular or premium).

The same one-off charge of N1,000 applies for the replacement of debit cards at the customer’s instance for lost or damaged cards. In the same vein, upon expiry of existing cards, customers are to pay the same one-off charge of N1,000 irrespective of card type. Conversely, no charge shall be required for pre-paid card loading/unloading.

According to the policy, the current NIP charges apply to use of Unstructured Supplementary Service Data (USSD), purchase with cash-back will attract a charge of N100 per N20,000 subject to cumulative N60,000 daily withdrawal. Also, for cards linked to savings account, a 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.

Furthermore, here will be no more charges for reactivation or closure of accounts such as savings, current and domiciliary accounts while status enquiry at the request of the customer (like confirmation letter, letter of non-indebtedness and reference letter) will now attract a fee of N500 per request.

On Current Account Maintenance Fee (CAMF), the Guide expressly stated that this would be applicable only to current accounts in respect of customer-induced debit transactions to third parties and debit ransfers/lodgments to the customer’s account in another bank. It emphasized that CAMF is not applicable to Savings Accounts.

The CBN carried out the review of the Guide, which also prescribes charges permissible for Other Financial Institutions and non-bank financial institutions, in order to align with market developments.

“To guard against excess, unapproved or arbitrary charges by banks and other financial institutions, the Guide stipulates a penalty of N2,000,000 per infraction or as may be determined by the CBN from time to time for financial institutions that breach any provision of the guide.

The Guide also emphasized that failure by any bank 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,” the report said.

It also directed banks to log every complaint received from their customers into the Consumer Complaints Management System (CCMS) in addition to generating a unique reference code for each complaint lodged, which must be given to the customer.

Failure to log and provide the code to the customer, it added, amounts to a breach and is sanctionable with a penalty of N1,000,000 per breach.

This Guide, which replaces the Guide to Charges by Banks and Other Financial Institutions issued in 2017, takes effect from January 1, 2020, and may be reviewed from time to time to reflect changes in the business environment.

The CBN therefore urged financial services providers and their customers alike to acquaint themselves with the provisions of the Guide and be properly guided accordingly.

The Nation

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Slash in bank charges excite Nigerians

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Banks customers on Monday commended the Central Bank of Nigeria (CBN) for its move in slashing various banks charges.

A cross section of customers who spoke with News Agency of Nigeria (NAN) in Abuja on Monday described the development as the right step in the right direction.

The apex bank in new guidelines on Sunday announced the downward review of most charges and fees for banking services, other financial, and non-bank financial institutions, with effect from Jan. 1, 2020.

CBN Slashes Bank Charges; Cuts ATM fee to N35

Among the charges, CBN said bank customers would now pay N10 for electronic transfers below N5,000, and N25 for electronic transfer between N5,000 and N50,000. Only electronic transfer above N50,000 will attract N50 charge.

Previously, bank customers pay N50 charge for electronic transfers below N500,000.

The guide also slashed charges for cash withdrawal via Other bank’s ATM to “maximum of N35 after the third withdrawal within the same month” from “N65 after the third withdrawal within the same month”.

A bank customer, Mr James Onumah told NAN that the CBN’s directive was a new year gift to the all bank customers.

Onumah said most Nigerian banks were still characterised with some inefficiencies yet they charge customers for services they didn’t provide.

He explained that withdrawal charges of about N65 being taken from bank users by banks was exploitative and uncalled for.

Mrs Hadiza Maikarfi said the announcement was cheering news for her at the weekend.

Maikarfi said various bank charges before the reduction were too high for customers like her could bear urging the apex bank to still review them downward.

According to her, these charges can discourage people from getting involved in financial services thereby affecting financial inclusion being promoted by the bank.

Sani Nura, another bank customer urged CBN to supervise banks to ensure the directive was carried out and implemented fully.

Nura added that the bank’s charges reduction by the apex bank was timely due to the current hardship being experienced by the citizens.

Funke Akin told NAN that she had been celebrating over the reduction as anounced by CBN.

Akin said she was particularly happy over the removal of card maintenance charges adding that she never understood the essence of such charges by banks.

Mr Isaac Okorafor, the CBN Director, Corporate Communications Department, on Sunday said the guidelines would take effect from Jan. 1, 2020.

Okorafor, while briefing newsmen said the step was in furtherance of the bank’s quest to make financial services more accessible and affordable to various stakeholders in the economy.

He explained that some major highlights of the new guidelines included the removal of Card Maintenance Fee (CAMF) on all cards linked to current accounts.

He said there would be a maximum of one Naira per mille for customer induced debit transactions to third parties and transfers or lodgements to the customers’ account in other banks on current accounts only.

Okorafor explained that it all involved reduction in the amount payable for cash withdrawals from other banks’ Automated Teller Machines as Remote-on-Us transactions.

The director said the reduction was from N65 to N35 after the third withdrawal within one month.

According to him, other reductions include Advance Payment Guarantee (APG), now pegged at maximum of one per cent of the APG value in the first year and 0.5 per cent for subsequent years on contingent liabilities.

On debit card charges, Okorafor said that the new guide stipulated that a one-off charge of N1,000 applied to the issuance of cards, irrespective of card type regular or premium.

He noted that the same one-off charge of N1,000 applied for the replacement of debit cards at the customer’s instance for lost or damaged cards.

According to Okorafor, upon expiry of existing cards, customers are to pay the same one-off charge of N1,000 irrespective of card type and no charge should be required for pre-paid card loading or unloading.

He explained that the current NIBSS Instant Payments (NIP) charges applied to use of Unstructured Supplementary Service Data (USSD), purchase with cash-back would attract a charge of N100 per N20,000 subject to cumulative N60,000 daily withdrawal.

The CBN spokesman noted that for cards linked to savings account, the maintenance fee had been reduced to a maximum of N50 per quarter from N50 per month amounting to only N200 per annum instead of N600.

The director hinted that there would be no more charges for reactivation or closure of accounts such as savings, current and domiciliary accounts while status enquiry at the request of the customer like confirmation letter, letter of non-indebtedness and reference letter would now attract a fee of N500 per request.

“On Card Maintenance Fee (CAMF), the guide expressly stated that this would be applicable only to current accounts in respect of customer-induced debit transactions to third parties and debit transfers and lodgments to the customer’s account in another bank.

“It emphasised that CAMF is not applicable to Savings Accounts.

“CBN carried out the review of the guide, which also prescribes charges permissible for Other Financial Institutions and non-bank financial institutions, in order to align with market developments.

“To guard against excess, unapproved or arbitrary charges by banks and other financial institutions, the guide stipulates a penalty of N2,000,000 per infraction or as may be determined by the CBN from time to time for financial institutions that breach any provision of the guide.

“The guide also emphasised that failure by any bank 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. ”

He said that the CBN, has directed banks to log every complaint received from their customers into the Consumer Complaints Management System (CCMS) in addition to generating a unique reference code for each complaint lodged, which must be given to the customer.

According to him, failure to log and provide the code to the customer will amount to a breach and is sanctionable with a penalty of N1,000,000 per breach.

NAN

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Gov. Sanwo-Olu visits China for business collaboration with Lagos

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Governor of Lagos State, Mr Babajide Sanwo-Olu is on a working visit to China to increase Foreign Direct Investment (FDI) and bilateral partnership.

The governor’s visit to the world’s second largest economy is coming barely three months after his trip to Japan in company of President Muhammadu Buhari

Sanwo-Olu hopes to sign partnerships and seal deals that will support the Lagos’ effort in transforming its economy to be 21st century compliant.

Sanwo-Olu will meet top management teams of China Railway Construction Company (CRCC) and China Civil Engineering Construction Company (CCECC) for joint appraisal of ongoing infrastructural projects being handled in Lagos by the Chinese construction giants.

During the visit, he will deliver a keynote speech at China-Africa Business Council, which aims at putting Lagos before the Chinese investment community and declare the state’s openness to foreign investment.

The governor’s economic ambassadorial role will take him to Zhuhai Changiong Ocean Park, Huawei, GAC Motor Factory and Gree Air Conditioning for discussion on partnerships in the areas of industry, tourism and facility development.

Since inception, the Sanwo-Olu administration has driven up investment efforts in infrastructure, renewable energy, Information and Communication Technology (ICT) and transportation.

The governor has been unequivocal about his quest for local and foreign finance to transform the state’s economy through sustained investment in infrastructure.

Presenting the N1.1trillion 2020 budget penultimate week, Sanwo-Olu noted that Lagos had revised its approval procedures and extant laws to promote Public-Private Partnership.

These efforts have yielded positive fruits, given the recent release by the World Bank, which praised Lagos as a “significant contributor” to Nigeria’s impressive performance in the Ease of Doing Business Index. Nigeria moved 15 places higher in the ranking.

Lagos and China have strengthened their bilateral relation since the inception of the Sanwo-Olu administration. Recently, the governor witnessed the signing of four agreements with China Development Bank (CDB), including $629 million financing facility, to accelerate completion of the Lekki Deep Seaport project, which started in 2011 and will be completed in 30 months.

The loan was secured from the Chinese bank after China Harbour Engineering Company (CHEC), which owns majority shares in the project, signed a 45-year concessionary agreement with Lekki Port LFTZ Enterprise Limited (LPLTZ).

to complete the Phase 1 of Nigeria’s first deep seaport project in Lekki – a coastal community in the nation’s commercial nerve-centre – Lagos State.

After completion, the deep seaport will have two container berths of 680-metre long and 16.5-metre water depth. It will also have the capacity to be berthed by fifth generation container ships, which has a capacity of 18,000 TEU ship.

Commenting on the development, Sanwo-Olu described it as “another milestone” for the state in infrastructural development and commerce, saying the signing of the agreements ended period of uncertainty that had trailed the delivery of the project.

He noted that the completion of the project would invigorate the Lagos economy and push it up in the index of largest economy in the world.

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Elumelu requests for $2.5B to empower African entrepreneurs

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Chairman, Heirs Holdings, Tony Elumelu, has asked Japan to invest $2.5 billion representing five per cent of its $50 billion commitment to Africa.

Elumelu, African investor and philanthropist, spoke at the seventh Tokyo International Conference on African Development (TICAD) in Yokohama, Japan.

“At TICAD 2016 in Kenya, Japan pledged $30 billion for Africa. This year you have generously increased this to $50 billion. If we invested just five per cent in Africa’s new generation of entrepreneurs, following my Foundation’s robust, proven model of getting capital directly to those best placed to catalyse growth and create real impact, we could touch 500,000 lives, across the 54 African countries, broadening markets, facilitating job creation, improving income per capita, and laying the key foundation for political and economic stability”, Elumelu said.

His statement captured his vision of a relationship between Japan and Africa, which prioritises economic and shared prosperity. He outlined the three key pillars of a bold and transformative structure: investment in infrastructure, partnership with the African private sector, and investment in Africa’s youth.

He urged Japan to learn from the example of the Tony Elumelu Foundation, which champions empowering African entrepreneurs, as the most sustainable means of accelerating the development of Africa. The Tony Elumelu Foundation, in just five years has assisted over 7,500 African entrepreneurs across every African countries, with seed capital, capacity building, mentorship and networking opportunities through its $100 million Entrepreneurship Programme.

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