Big Burden Of Banking Depositors Lament Mounting Bank Charges That Constitute Huge Drains On Their Accounts


IT is not uncommon these days to see bank customers looking glum. This may not be unconnected with the inexplicable short messages on their mobile phones, informing of sundry deductions from their accounts. These deductions come in varied forms. It is either the bank is informing customers that N50 stamp duty charge had been deducted or that N100 account maintenance fee had been deducted. Another message may come at few minutes interval to the effect that another N100 had been deducted as value added tax on account maintenance. The messages are never-ending.

Bank customers are getting confused everyday, as the charges are becoming too numerous. And they are asking questions, which the banks have been unable to answer satisfactorily.

Consequently, some people are of the view that the Federal Government has a hand in this unpalatable occurrence. To this category of people, it is one of the surreptitious moves by the Federal Government to generate revenue at all cost, which has informed this method of collecting taxes from account holders.

Recently, the Federal Government, through the Central Bank, directed Deposit Money Banks to commence collection of N50 stamp duty on receipt of financial value of N1, 000 and above from bank accounts. Under the new directive, only transfers within personal account in the same or another bank are exempted from the charge.

Over 50 million active accounts in the banking sector will be listed in the new revenue drive with the take-off of N50 stamp duty charges expected to fetch the government about N2.5b daily.

But account holders are demanding meaningful explanations at the manner of deductions from their accounts. They want tenable explanations, as they consider the deductions too numerous and therefore unbearable. Some people are even saying the new revenue drive could undermine the nascent cashless policy, which Nigerians are beginning to embrace, as deductions are made from their accounts through e-transactions.

For many, who had high expectations from the ‘change mantra’ of the present government, these policies have added to the burden of ordinary Nigerians, who toil ceaselessly to earn a living and care for their families.

To Chris Kehinde Nwandu, the new revenue drive by the Federal Government is tantamount to sheer deceit by the ruling party, which promised Nigerians better living during the last electioneering campaign.

“I’m totally against the tactics being adopted by the Federal Government and the CBN to raise money, particularly through the N50 stamp duties. Why must I pay for the shortcomings of others? Why must they charge me N50 for every single transaction in the bank? Why would a bank just wake up one day to impose such a tariff on me? Was that part of the agreement we had when I opened my accounts? Why didn’t the bank tell me from the onset about such tariffs so I could decide whether to go ahead or not,” he queried.

Nwandu, who is the National President, Bloggers Association of Nigeria, said such a directive is uncharitable and is aimed at the wrong people.

“They are trying to take from the back what they annulled initially through the abolition of the COT. This is an economy that is already on its knees, where the per capita income is low; where workers are being owed salaries running into months and where people cannot meet their financial obligations. Now, the little they have, you continue taking from them. The policy will discourage savings. Indeed, some people are already finding alternative means of keeping their money,” he said.

On the argument that the policy does not affect salary accounts, Nwandu said it’s irrelevant.

“As far as I’m concerned, it should be abolished. This policy affects me in several ways. You may say it’s not much, but by the time you aggregate N50 from several million bank accounts of Nigerians, who engage in bank transactions daily, you will see that it is a huge sum at the end of the day,” he explained.

He considered the deduction as another way to enrich the banks.

“The banks are already charging us for SMS, cheque books and such others, so why the new charges? Taxes are being raised; even electricity tariffs have been increased. Is this the change we voted for? Government should find alternative means of increasing its revenue base through diversification of the economy, especially in the area of agriculture and mining, instead of taxing the poor masses to their grave.”

Temitope Ajayi, a Lagos based Public Relations practitioner, believes that Nigeria is in a deep mess, as far as public finance is concerned and the situation is made even more precarious due to the global slump in crude price and the pervasive corruption in the land.

We have a budget that has over N3tn deficit financing gap and government will borrow to finance the hole in the budget. So, it’s only to be expected that government will expand short, medium and long-term revenue sources. The long term is the much talked about diversification through solid minerals and agriculture, but that won’t happen in the next six months to two years,” he said.

So, in the short run, according to Ajayi, the government can only look for the low hanging fruit revenues to pluck.

“Expanding the tax net is one, blocking revenue leakages is another, as well as looking for ways to increase revenue drive from revenue generating agencies. Looking into previously untapped revenue sources in royalties and duties also come to play and the stamp duty is one of them. That government is weaning itself from oil and gas revenue, a step in right direction.”

Ajayi noted that the current policy would give Nigerians opportunity to hold their leaders accountable, when they begin to pay taxes and levies like it’s done in developed countries.

“Some persons and businesses do not pay tax in Nigeria because government has cheap oil revenue. According to FIRS, less than 20 per cent of businesses in Nigeria pay taxes on both company income and VAT and when they pay at all, they do not pay the right amount. Tax collectors collude with people to underpay government. So, I think this policy will help check the ugly trend.”

However, Ajayi acknowledged that the newly introduced stamp duty would affect him and a lot of other hard working Nigerians.

“I pay N50 on every N1000 transfer into my current account, which alone would cost me N200, 000 in a year if aggregated, because I keep about four current accounts personally. When you add company’s accounts, it will be far more. It means, as a citizen, I’m paying more and no one wants to pay money to government. Even in a matter of tax, we all look for legal ways to reduce tax obligations. So, if paying more will help Nigeria get out of the woods for now, I’m ready to bear it. At least, our leaders will no longer have a free ride looting our money again; Nigerians will now ask questions,” he said.
Chukwudi Iwuchukwu said the policy is ill-timed and amounts to a slap on the face of hard working Nigerians, who try to survive with little or no support from government.

“Nigerians are already overburdened,” he lamented. “So, why force us to pay NIPOST, a dead entity at this age and time? It shows a retrogressive view of the economy and is a bad political move in any other country. To people, who depend on others for survival, N50 is a meal at the Mama put. And though to the rest of us, these figures might seem small, but they add up in the end. They should tell us what we are getting in return? Nothing! After politicians have been raping us for 16 years, this is what we get? More rape?”

To Iwuchukwu, who is the CEO of Visage Media, N50 may appear an insignificant amount to his outfit, but paying the money to a government that gives nothing in return is the problem.

But Norbert Sarge Olisakwe believes God divinely chose the current administration. To him, the tax drive is welcome, but he would want it to be progressive.

“I would prefer to see higher taxes on luxury goods to curb the appetite of the richer class. CBN’s many monetary policies somersaults are a reflection of the economic anomaly that plays out in Nigeria. This is a nation that thrives on confounding textbook theories and experts. So long these policies are well intended, may God’s wisdom help the CBN Governor and his team arrive at the right formula before Nigerians consider mass action to express their distress,” he said.

On the bank deductions, he said: “I personally don’t find it funny, given banks’ antecedents of exploiting such mechanism to milk their customers. But I’m willing to make the necessary sacrifice, as long as the aim is to rebuild our nation’s commonwealth. Like many Nigerians, I’m also feeling the pain occasioned by the rising cost of living, instability and palpable fear in the work place due to the state of the economy, as well as views expressed by a majority, who believe we may not survive these trying times as a nation.”

Some of the banks have exonerated the financial institutions from the conspiracy theory, as put forward by respondents.

According to them, the many reductions and charges are at the instance of the apex bank, the Central Bank of Nigeria (CBN). According to an authoritative source, the stamp duty, account maintenance and VAT charges have become new sources of revenue to the government in the face of dwindling fortune from the oil sector.

“The charges don’t come to the banks as you may think. They are Federal Government money, which we collect and remit to the government through the Central Bank of Nigeria. You are aware that Nigeria no longer makes money from crude oil. So, government is now looking inward to generate revenue internally.

“There are so many charges initiated by the Central Bank. The current account maintenance and stamp duty charges were initiated by the government and we only collect and remit. Where banks are looking inwards to make money is the issuance of cards such as ATM, Visa or POS. These charges don’t come to the banks.

“We are now encouraging our customers to make use of cards because that is where we make our money. If you use the card to buy something, you will have to pay some charges. The same thing goes for ATM cards used in another bank other than your own bank, when customers pay a token as charges for interbank settlement,” said a reliable official with Fidelity Bank during the week.

The consumer protection agency (CPA) is aware of complaints by bank customers and has taken on Central Bank on the matter.

The Deputy Director, Public relations, Abiodun Obimuyiwa acknowledged receipt of complaints on the issue, explaining that his agency has written a letter to the CBN since January for explanation in order to address numerous complaints from bank users.

According to the CPA image-maker, the apex bank is yet to respond to the letter titled “consumer complaints on multiple charges for electronic card usage.”