Banking in Nigeria has changed significantly over the years. From the days of tally number to the era of banks opening multiple branches across the country to reduce the waiting-time by customers in banking halls, now bank customers are treated to electronic banking experience.
Today, most working adults have at least one bank account; some people even have multiple accounts. Nigeria’s active bank account now stands at about 111.54 million, data from the Nigerian Inter-Bank Settlement System Plc (NIBSS) reveals.
While this increase in the number of active bank accounts is a big boost to achieving the National Financial Inclusion Strategy goal aimed at reducing the financial exclusion rate from the baseline figures of 46.3% in 2010 to 20% in 2020. This means that these large number of bank accounts holders may be targets of unscrupulous elements who will want to deploy every means, especially technology and insider mechanisms to deprive bank customers of their hard-earned money.
These accounts are managed and operated by the Deposit Money Banks (DMBs), Microfinance Banks, and Primary Mortgage Institutions. The safety, speed and convenience with which banking transactions are conducted nowadays the Central Bank of Nigeria (CBN) through its policies on electronic banking practices has discouraged Nigerians from keeping money outside the system.
Banking transactions largely take place with no issues raised. But with the innovation has come the activities of fraudster and scheming bankers who are out to rip customers off. Because it is electronic, it is understandable that there will be technical glitches which can frustrate bank customers.
Most banks have in place robust customer complaint/handling systems some even have online real time interaction with their customers to quickly resolve complaints but where this fails, bank customers can escalate their complaints to the CBN through its Consumer Protection Department.
Some of the issues bank customers face are unfair or inexplicable charges, poor customer service by bank staff, unauthorised transactions on customer accounts through bank transfers or ATM withdrawals etc.
Inundated with complaints from customers, the CBN has rolled out a template of fines and other sanctions against any bank engaging in illegal deductions or charges on customers’ accounts or tardy work ethics leading to customer dissatisfaction.
To address the deluge of bank customers’ complaints, the CBN created a Consumer Protection Department to deal with bank customers complaints.
The CBN Governor, Mr. Godwin Emefiele has called on bank customers to come forward and lodge their complaints before the Consumer Protection Department for thorough investigations and punishment of any bank found culpable.
According to him, “the CBN will not take lightly to issues of overcharging of customers by banks and that is why we have issued several exposure drafts and one of them is the guide to banking charges. This is a contract between banks and their customers,” he said.
Vice President, Prof. Yemi Osinbajo, while addressing industry stakeholders at a forum organised by the Nigerian Communications Commission (NCC) and the Central Bank of Nigeria (CBN) estimated the annual cost of Nigerian telecommunications related financial services fraud at N197 billion (USD544,048,605).
Osinbajo said “technological innovation must continue and confidence in the marketplace and system be maintained in spite of the regular presence of fraudsters seeking to exploit weaknesses.
“SIM swaps, identity theft, information database hacks and theft of Nigerian Bank Verification Numbers” the Vice President said are methods fraudsters deploy to deprive bank customers of their money. All these are aside from the activities of banks and bankers who have devised devious methods of also creaming off money from their customers’ accounts. Of particular concern is the case of bank charges which assumed such frightening levels that the CBN’s financial inclusion initiative is under threat.
To address these, Emefiele has initiated several measures to curb bank fraud and protect bank customers. He has mandated the CBN’s Customer Protection Department to develop a set of rules for both banks and their customers essentially to protect the customer. In Nigeria, bank customers have certain rights and duties guaranteed by law, regulation and conventions.
Rights of a Bank Customer
A bank customer has the right to disclosure of information from his/her bank on goods and services the bank offers. The information provided must be complete, relevant and truthful. The bank must explain to the customer’s understanding all contractual terms and charges prior to the consummation of any agreement or contract. This right enables customers to have relevant information in order to make rational choices. It amounts to a breach of the customer’s right if a bank fails to provide this information or deliberately misleads the customer in any way.
Right to choose
A bank customer has the right to select from the range of products and services made available by his/her bank at competitive prices. This means that as a customer, you can, at all times, decide on the product or service to accept/purchase and the ones to decline. It is wrong for a bank to restrict your choices or compel you to accept/purchase products or services that are ill-suited for your needs. Where the customer is not satisfied with the bank’s service delivery on any product or service, the customer has the right to end the contract or even the banking relationship provided all outstanding commitments are settled by the customer.
Right to safety
This right requires a bank to guarantee all its customers a secure and conducive banking environment devoid of threats to their safety and health. The bank customer has the right to be reasonably protected from accidents while on the premises of their bank. They also have the right to be protected from the negative effects of pollution of any kind whether arising from their bank’s operations or from other sources. It is necessary to stress that a bank is obligated to adhere strictly to applicable safety laws and directives to ensure that the customer’s safety and wellbeing is adequately guaranteed while the customer is on the premises of the bank.
Right to privacy and confidentiality
As a bank customer, you have the right to freedom from disclosure of your account details by the bank as well as intrusion into your account by third party. In other words, your bank must not divulge your account information to a third party; the bank must also protect your information from unauthorised access by a third party.
Right to redress
A bank must provide its customers a redress mechanism to express their displeasure or grievance. The mechanism must be free, accessible, transparent, timely and convenient. The customer has a right to efficient complaints management system through which he/she can lodge complaints against the bank. The bank customer also has the right to be kept abreast of the resolution process (acknowledgement, feedback, updates, explanation) and ultimately, basis of decision. Where the customer is not satisfied with the decision of their bank, they have the right of review either by the bank, the CBN or the court.
Right to good service
All customers have a right to value for their money which involves the right to be treated with respect and dignity by banks and their representatives. A bank would have failed if it was unable to offer quality and value-adding banking services to a customer. Part of this right is that the bank must provide appropriate response to customer needs and complaints.
Right to equality
This right requires that a customer is treated equally as other customers regardless of differences in financial standing/deposit balance, physical ability, age, gender, ethnicity, or creed. It is wrong for a bank to offer preferential treatment to some customers at the expense of other similar kind of customers. However, banks may decide to differentiate customers on account of the nature of products customers purchase or subscribe to. In this case, some customers may benefit from certain privileges which are features of specific products or services.
Right to free monthly statement of account
The provision of the Revised Guide to Bank Charges is that banks are required to provide their customers free statement of account on a monthly basis. This means that you have a right to get your monthly statement of account from your bank at no cost. It should be noted, however, that the Guide provides that any special request attracts a fee of N20 per page (revised downwards from N50 per page).
With effect from 1st January 2020 Emefiele and the CBN introduced a new regime of reduced bank charges, according to him to mitigate the excessive charges bank customers were forced to cough out by their banks.
The reduced bank charges are applicable to bank accounts, electronic transfers, and Automated Teller Machines (ATM). Electronic transfers below N5,000 will attract a maximum charge of N10; transfer from N5001 – N50,000 – N25; and transfers above N50,000- N50.
The new charges will allow bank customers to embrace electronic banking channels and encourage financial inclusion.
Transfers below N5,000 will attract a maximum charge of N10; transfer from N5001 – N50,000 -N25; and transfers above N50,000- N50. Card maintenance fee on current account has been removed as the accounts already attract account maintenance fee. Savings accounts will now attract a card maintenance fee of N50 per quarter from N50 per month. Annual Card maintenance fee on foreign currency (FCY) denominated card is reduced to $10 from $20. ATM charges are reduced to N35 after third withdrawal within a month from N65.
The charge for hardware token will on cost recovery basis be subject to a maximum of N2,500 from previous maximum charge of N3,500. Fee for SMS mandatory alert will be on cost recovery from previous maximum charge of N4. Bill payment via e-channels will attract a maximum charge of N500 from 0.75 percent of the transaction value subject to a maximum of N1,200.
CBN said a new section on Accountabilities/Responsibilities and Sanctions regime will address instances of excess, unapproved and/or arbitrary charges.
It is imperative to note that the CBN guidelines say that the bank must resolve your complaint within 14 days of receipt of the complaint. If for some reason, the bank has not satisfactorily resolved the complaint, affected bank customers may present the issue before the Consumer Protection Department of the CBN.
It is important to state that unsatisfied bank customers can only take complaints to the CBN after they have made a complaint to their bank and given them 14 days after receipt of the complaint, to resolve it. Apart from resolving the complaint, the CBN also has the powers to impose financial penalties on the banks for failure to resolve customer complaint.
