CBN and electronic transaction charges
As Nigerians grumble over charges on electronic and other bank transactions, especially on Point of Sale (PoS), the Central Bank of Nigeria (CBN) has come to the rescue of the banking public by reviewing some of the fees. Users and operators of the PoS had complained about the additional N50 charged customers on the use […]
As Nigerians grumble over charges on electronic and other bank transactions, especially on Point of Sale (PoS), the Central Bank of Nigeria (CBN) has come to the rescue of the banking public by reviewing some of the fees.
Users and operators of the PoS had complained about the additional N50 charged customers on the use of the machine, apart from bank charges.
Many customers queried the rationale behind the charges and subsequently reduced the use of the PoS. For example, while buying fuel, motorists would prefer to pay cash rather than use the PoS, just because of the extra N50 charge. Also, shoppers are said to have reduced purchases with their cards; they use cash instead.
I want to appreciate the CBN for the review of the charges, which is expected to take effect from January 1, 2020.
It is indeed laudable that the CBN listened to the complaints of the people as the numerous charges really destabilised the banking public.
According to the CBN, “The revision of the guide to charges and strengthening of the consumer protection regulation was necessitated by continued evolution in the financial industry over the past few years, which has spurred innovation and the introduction of new products, channels and participants.
“These developments have made it imperative for continued vigilance by the regulatory authorities to ensure the protection of consumer rights as more individuals are financially included while encouraging market forces to increasingly drive pricing for financial products. These innovations, supported by a sound regulatory framework, have indeed transformed the Nigerian financial landscape over the past decade. This has driven financial inclusion (according to EFINA, financial inclusion increased to 63.2per cent as at December 2018 from 60.3per cent in December 2012) and the increased use of electronic payments across several channels by bank customers.
“Data from the Nigeria Inter Bank Settlement System (NIBSS) shows that PoS transactions increased by 4,692per cent between 2012 and 2018 from N48.46billion to N2.3trillion, while electronic transfers increased by 1,967per cent from N3.8trn to N80.42trn.”
The CBN noted that “paper- based cheque transactions declined by 32per cent from N7.48bn to N5.03bn. Similarly, statistics from NIBSS on electronic transfers from June to November 2019 show that the number of transfers below N10,000 accounted for 61per cent of the number of electronic transfer transactions. This is a confirmation that the reduction of the charges for micro-payments has huge potential for financial inclusion.
According to the apex bank, a fee scale has been introduced to replace the current flat fee of N50. Transfers below N5, 000 will attract a maximum charge of N10, transfers from N5,001 to N50, 000,will attract N25 while transfers above N50, 000 will attract N50. This is fair, to say the least.
Also, the card maintenance fee on current account has been removed as the accounts already attract such fee, while savings accounts will now attract card maintenance fee of N50 per quarter from N50 per month. ATM charges has also been slashed to N35 after third withdrawal within a month, from N65.
As these reviews look insignificant, it will return confidence on the banking system. It is more grease to the elbows of the CBN.
Deji Geoffrey, Abuja