At a time that the Central Bank of Nigeria (CBN) is moving to enhance financial inclusion through zero transaction cost, most banks in the country are charging higher commission on turnover (COT) of N3 per mille as against N2 as agreed by both the Bankers’ Committee and the CBN last year, BusinessDay investigations have shown.
The banks are said to be exploiting unsuspecting customers to make up for losses occasioned by reduction in public sector funds holding and charges from ATMs, a development some analysts say may pitch them against the CBN.
Ayodeji Ebo, head, research, Afrinvest, advised banks to key into the CBN’s financial inclusion using information technology for revenue generation, rather than higher charges.
“In our view, the realistic ways banks can succeed in the effective reduction of cost in 2014 will be through improvements in the electronic and mobile banking platforms, as well as tapping into the CBN’s financial inclusion strategy, on the back of robust information technology platform,” Ebo said.
“This should be the main focus of most banks in 2014, especially the tier-1 banks, in order to deliver robust and efficient returns to investors amid the stiffer operating environment,” he said.
Section 3.1 of the Guide on Charges agreed by both CBN and Bankers’ Committee last year provides that COT is negotiable, subject to a maximum of N3 per mille in 2013, N2 per mille in 2014, N1 per mille in 2015, and zero COT in 2016.
BusinessDay further learnt that the Godwin Emefiele-led CBN is worried over the trend and is considering possible sanctions for non-compliance with the refund deadline and those still charging higher rate.
The implication, according to some analysts, is that CBN and banks may be heading for a collision on this since a source says the practice is against the current CBN campaign to enhance the rights of customers through creation of value on their deposits.
Another contentious area that may generate controversy, according to BusinessDay findings, is the CBN directive for the refund, by the end of this month, of billions of trapped customers’ funds in banks’ Automated Teller Machines (ATMs) through error debits and other maintenance fees charged by banks, which are not covered in the revised guide to bank charges.
Several calls and messages to Mu’azu Ibrahim, CBN’s director of corporate communications, on the nature of sanctions by the regulatory bank following the expiration of the deadline next week, were not responded to.
Bolade Agbola, executive director, Cashcraft Asset Management, said that banks should by now be growing their risk assets rather than trading on trapped customers’ funds and arbitrary charges, adding that the policy was capable of eroding confidence of the investing public in banks.
JOHN OMACHONU
