south east almalgamated market traders association[SEAMATA] raises alarm over excessive bank charges

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THE South East Amalgamated Market Traders Association (SEAMATA) recently lamented multiple and indiscriminate charges and deductions on customers’ accounts by Money Deposit Banks operating in the zone.

The traders petitioned the Central Bank of Nigeria (CBN) to intervene and stop the excessive bank charges. Their grievances were contained in a letter addressed to the CBN Governor, Godwin Emefiele, last week, in which they described the action of the commercial banks as “financial oppression.” The letter was signed by the President-General, and Secretary of the association, Gozie Akudolu, and Alex Okwudiri, respectively.

The petition to the CBN alleged how the depositors were being ripped-off regularly by the banks operating in the South East region. They also argued that most of the transactions on which customers’ accounts were charged should be the social responsibility of the banks. They also stressed that the banks make indefensible deductions and charges ranging from confirmation of deposits to signatures of customers. By this unconscionable act, the traders stated that the banks have “turned themselves into a huge burden for customers.”The indiscriminate charges, according to them, include online transactions, stamp duties and other sundry transactions.                    

The complaints by the traders are legitimate. Many bank customers have expressed misgivings over the illegitimate charges. Banks and bankers all over the world are known for being prudent, discreet and ethical in matters concerning their customers’ deposits. Good service delivery without underhand practices such as excessive bank charges boosts customers’ confidence in their banks. Anything contrary to this revered banking practice is unprofessional and unacceptable.    

Undeniably, banks are vital to the economic wellbeing of any country. Ideally, the role of commercial banking is to satisfy the needs of the banking public and help grow the economy through lending money. It is therefore expected that a commercial bank must compete with others while performing the assigned tasks. Indisputably, bank customers will readily pay reasonable charges for services rendered on their behalf. But, when the charges become excessive, as the South East traders stated in their complaint, immediate action should be taken to address the problem. The recourse to excessive charges by commercial banks amounts to economic exploitation.

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Some years ago, the Consumer Advocacy Foundation of Nigeria (CAFON) took the matter of excessive bank charges to the CBN. The apex bank decried the practice. Consequently, it mandated commercial banks to refund N6.2 billion excess charges on transactions made for 2015. The refund, CBN had explained, arose from more than 6,000 complaints of unauthorised bank charges brought to its notice. We condemn excessive bank charges and urge the CBN to wield the big stick and discipline all erring banks forthwith.  We also call on the CBN to, in public interest, publicise the “Revised Guidelines” on bank charges. By so doing, customers will know the charges approved for commercial banks. There are many bank customers in court today over excessive bank charges. Some years ago, aggrieved bank customers in the United States under the #Occupy Wall Street, demonstrated against perceived greed, and exploitation of bank customers. Nigeria may get to that point soon, if urgent measures are not taken to address excessive bank charges by commercial banks.

Agreed that trust is vital in the banking sector, and every economy is as strong as its banks, but the greed of some banks will not help the economy. Our banks should encourage their customers to bank with them. They should not scare them away with excessive charges. At present, there are sundry charges such as ATM charges, various overdraft commissions, introduction letters; periodic statement of accounts, newly introduced stamp duty and Value Added Tax (VAT), among other charges. These are disincentives to bank customers. Unfortunately, these charges are deducted even when bank services are adjudged poor and inefficient by customers.    

Despite the fact that CBN has at various times moved against inefficient banking services across many banks’ branches in the country, customers still lament their inability to withdraw money with ease from their accounts. Businesses suffer as a result of this. That is part of the complaints of the South East traders. In every business, including banking, the customer will always remain the “king.” That means he should be treasured and given satisfactory services at all times. Nigerian banks may remain at the lower rung of global bank ranking if they fail to take customer satisfaction seriously. Therefore, let the banks avoid unethical practices that will reinforce excessive bank charges.

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