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Profiles - October 18, 2018

Senate calls for suspension of maintenance fees for ATM cards

The Senate condemned the Deposit Money Banks for the excessive and illegal charges imposed on their customers.

While resolving to investigate the charges brought by the commercial banks, the Senate asked the Central Bank of Nigeria to suspend the monthly fees for maintaining the ATM cards imposed on customers.

These were some of the resolutions passed by the lawmakers in Wednesday’s plenary session while adopting a motion proposed by Senator Gbenga Ashafa, entitled “Illegal and Excessive Fees of Nigerian Banks on Customers’ Accounts with Particular Focus on ATM Maintenance and Withdrawal Charges’.

The Senate resolved to “direct the committees on Banking, Insurance and Other Financial Institutions, and Finance to conduct an investigation into the propriety of the ATM card maintenance charges in comparison with international best practices and report back to the Senate.”

The upper chamber of the National Assembly also mandated the committees to invite the Governor of the Central Bank of Nigeria, Godwin Emefiele, to explain why the official charges as approved by the bank were skewed in favour of the banking institutions as against the ordinary customers of the banks.

The lawmakers further resolved to urge the CBN to suspend the ATM card maintenance charges being deducted from customers’ accounts and instruct the banks to reconfigure their ATMs to discharge up to N40,000 per withdrawal, pending the outcome of the investigation by the committees.

The Consumer Protection Council was also urged to be up and doing in taking up the plight of ordinary Nigerians by looking into the various complaints of excess and unnecessary charges by banks.

Moving the motion, Ashafa said, “The Senate notes with concern that there have been several complaints from Nigerians generally and on the social media concerning illicit and excessive charges by Nigerian commercial banks on customers’ accounts, with a particular focus on ATM maintenance charges and ATM withdrawal charges.

“The Senate is aware that the CBN in 2017 increased the maintenance fees charged by banks on debit and credit card maintenance from N100 a year to N50 per month (N600 a year).

“The Senate is concerned that in a viral campaign that began on social media on Monday, 3rd of September, 2018, many Nigerians called for reforms of the banks. A campaign tagged: #Reform9jabanks, began on Twitter when a United Kingdom-based Nigerian medical doctor, Harvey Olufunmilayo, lamented the state of banks in Nigeria compared to those abroad.”

Ashafa decried that card users were being charged N65 per withdrawal using ATMs after the third monthly withdrawal from the machines outside that of the domicile bank of the user.

The lawmaker equally criticised most banks, which “have deliberately manipulated their ATMs not to dispense more than N10,000 per withdrawal in some cases, and in most cases, not more than N20,000 per withdrawal at the ATM.”

He said, “This is a deliberate ploy to manipulate the ATMs, which are ordinarily manufactured to dispense as much as N40,000 per transaction, in order to attract more bank charges from customers, who are forced to carry out more transactions due to the manipulated machines.

“The Senate is worried that it appears that the CBN is becoming insensitive to the plight of Nigerians, who are already complaining of excessive charges by commercial banks. If the CBN is trying to encourage a cashless Nigeria, why should they be making it more difficult and expensive for Nigerians to do transactions?”

Seconding the motion, the Deputy President of the Senate, Ike Ekweremadu, alleged that the CBN was encouraging the banks to continue with the trend against the interest of their customers, adding that the situation would discourage Nigerians from keeping their money in banks.

Senator Gbolahan Dada made an additional prayer, urging the CBN to introduce higher naira denominations of N2,000 and N5,000. Nobody seconded the prayer and it was dropped.

The Senate also on Wednesday approved the external borrowing plan of the Federal Government totalling $2.868bn, part of which is to fund the 2018 budget.

The approval followed the adoption of the report by the Senate Committee on Local and Foreign Debts, which was laid on Tuesday.

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