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Unlike NCC on telecoms, CBN lacks disciplinary claws on banking infractions—Experts

Official reactions of the Central Bank of Nigeria (CBN) on two critical issues of national importance currently hobbling financial transactions’ in Nigeria have shown that the apex bank, though has the necessary regulations, but lacks the will power and disciplinary claws to take actions.

The two key challenges affecting bank customers include the scarcity of clean lower naira notes and illegal surcharge of N65 from account holders even from the very first use of ATM in a month.

A lot of analysts say in issues of compliance and enforcement of regulations, the telecoms regulator, the Nigerian Communications Commission (NCC) tracks it better than the apex bank.

Many Nigerians say, they are yet to hear about serious sanctions on commercial banks from the CBN. But the NCC had been very effective on this regards in Nigeria.

In her lead argument on the growing silence of the CBN on observed shortchanging of account holders by some banks in the use of Automated Teller Machines (ATMs), President of the Consumer Advocacy Forum of Nigeria (CAFoN), Ms. Sola Salako-Ajulo argued that “Since the CBN gave directive that banks should refund the illegal withdrawals with interest, we Nigerians should ask the CBN what they are doing to ensure that this directive is followed”.

“This is important it is unfair to you just give a blanket directive that says ‘return all illegal deductions back to customers, but there is no mechanism known to customers on how banks will be compelled.

“Some of our questions on this matter include who determines what is illegal” Has CBN sent his officers to go to those banks to go and look into their books to determine what they have deducted that is illegal or is it the customer who doesn’t even know what is supposed to be charged for anything to know that a deduction is illegal”.

“So I think that CBN is just playing to the gallery on this issue we have raised it with them severally. In the first instance, it was this same CBN that gave the commercial banks the permission to charge on every third withdrawal on other banks ATM per month, that’s what the law says but from the experiences of customers and our members recently; from the first time you put your ATM in the bank’s ATM, N65 is being deducted. Members have complained to CBN and nothing happened.

“And so, it is CBN who needs to take the step to correct this. We find out that CBN is always trying to help the banks make income, because there are so many of this charges that CBN approved that when they brought out the draft charges to us, we actually contributed to it, we told them what the customers will like and what the consumers will not like.

“But they still went on and approve them. Don’t forget that this ATM charge had already been abolished, and it was just this new management in CBN that returned it. And so, if when it was abolished, Nigerians was patronising more ATM at that time, banking was going on and they were more confidence and people could take their money to the bank because they know that when they want to get it out, they are  not going to lose something.

But now, CBN in their wisdom has approved this N65 for transactions of withdrawing in ATM and consumers’ are crying over the charges.

On the issue of high presence of mutilated lower notes, several Nigerians say the CBN is only dribbling the informal sector because Nigerians within the segment are the most hit as they use lower naira notes more on a daily basis.

Surprising, the CBN only blamed commercial banks for sabotaging its efforts in replacing mutilated notes with new ones in the country without any warning or imposition of sanctions.

Acting Director of Communications Department of the CBN, Mr. Isaac Okoroafor, made the allegation in Lagos on Thursday last week in an interview with the News Agency of Nigeria (NAN).

Okoroafor was reacting to lamentation from Nigerians on the high level of mutilated notes in the country.

The CBN spokesperson said that the apex bank was aware of the development and had taken several measures to addressing the rising incidence of mutilated notes in the country.

According to him, one of the steps taken by the CBN in mopping up the mutilated notes from the system was reduction in the amount it charges banks for sorting the dirty notes for clean ones from N12,000 to N1,000 per box.

Okorafor said that the reduction in charges for the commercial banks which lasted for three months from Jan. 2 to March 28 was to encourage them to bring back more dirty notes to CBN.

He said the sorting charges which used to be N12,000 was later raised to N2,000 per box after the March 28 deadline when the window was closed.

Many Nigerians who barred their minds on the matter argued that for CBN to charge Nigerians to confess that commercial banks are sabotaging it and not wielding the big stick shows either that the apex bank had compromised on its regulatory responsibilities, thus leaving Nigerians in the informal sector to their fate in an ailing economy.

Analysts also argued that CBN is yet to show or tell Nigerians the number of new notes hoarders and sellers based on the revelation by Okorafor that “the serial numbers of the ones given out to the public by the CBN would be used to trace whoever perpetuated the act”.