Bank Charges and Cashless Policy
By Jude Chukwuemeka
Morning Crossfire pays attention to issues that have to do with cashless transactions in Nigeria. One aspect that Sheriff Quadri highlights is the Nigerian Senate asked banks to allow for a limit of 40,000 naira maximum per ATM withdrawal instead of 10,000 naira. The senate also urged the CBN to suspend ATM maintenance charges.
Sheriff says to the best of his and other people’s knowledge, these have not been done. Now, he says that with the introduction of charges on PoS terminal usages, many businesses have now begun charging Nigerians 50 naira for any transaction above 1,000 naira.
Wemimo, who spoke with a bank official says the official told her that if the machine dispenses 40,000 naira it is more work, so it wears out quickly. The official said they will rather reduce it to 10,000 naira so the machine doesn’t have to do so much work.
In answer, studio guest, Zeal Akaraiwe said: “It is like saying I can’t drive you from Lagos to Abuja because it is 800 kilometres. So, what I will do is drive you everyday 100 kilometres each so I can park the car for resting. That is absolutely ludicrous! It doesn’t make any sense.
“Whether the ATM counts 40 notes at once or not, it will rest. The manufacturers of the machine allow 40 notes maximum. If it’s 500 naira only, that’s 20,000 naira.”
Sheriff also thinks that the banks are out to make maximum profits at the expense of customers. He really thinks that is improper. But Zeal thinks it’s a matter of ethics.
“There are some people who are indifferent to a lot of these charges. So, I’m not going to call it a rip-off. However, I will still say that if a bank can do something, they should do it. If they can get away with ripping off customers, they will attempt it.”
Zeal believes that the reason why the ATM fail often is due to lack of maintenance. He also says on the show that “since 2010, the number of tech transactions have reduced from 40 million to 5 million. But ATM transactions have gone up from less than 100 million in 2010 to more than 900 million in 2018.
“For low income people who have to transactions of 1,000 four or five times a day, charging 50 naira on each transaction is unreasonable.”
However, he says that the 50 naira charge on transactions have not gone long enough for experts to track its effect. At least nine months is needed for anyone to see anything to it.
On the 18th of September, 2019, news reports revealed that the cashless policy of the Central Bank of Nigeria takes immediate effect in six states, and the FCT, but will be implemented nationwide from March 2020.
The bank says Nigerians will now be charged more for cash deposits and withdrawals in furtherance of its cashless policy.
In a circular, dated September 17, 2019, CBN director of Payments System Management Department, Sam Okojere, instructed deposit money banks to implement the policy starting from September 18.
According to the policy, a 3% processing fee will be charged for withdrawals above N500,000 for individual accounts, while 2% will be charged for deposits. For corporate accounts, a processing fee of 5% will be charged for withdrawals, and 3% for deposits above N3 million.
99.3 Nigeria Info FM correspondent, Georges Macnobleson-Idowu went out to get the views of some people in Lagos and they claimed that they are not happy about the latest bank charges. They want CBN to stop the policy.
Do you think the introduction of the PoS 50 naira charge would further hamper the successful implementation of the cashless policy in the country?
What are the checks and balances the CBN could put in place to regulate the charges banks levy their customers?
Zeal Akaraiwe - Financial Analyst
#MorningCrossfire with @wemimospot and @SheriffQuadry