Leading banks in the country, Zenith Bank Plc, Guaranty Trust Bank plc (GTBank) and United Bank of Africa (UBA) Plc altogether earned a total N42.95 billion as account maintenance fee in 2020.
This amount representing 12 percent increase on the N38.4billion reported in 2019, was legitimately earned from transactions on current accounts operated by the customers of the three banks.
The Central Bank of Nigeria (CBN) in its guide to charges by banks, other financial and non-financial institution that became effective January 1, 2020 had stated that the fee otherwise known as “Current Account Maintenance Fee (CAMF) is applicable to current accounts only in respect of customer-induced debit transactions to third parties and debit transfer. lodgements to the customer’s account in another bank.”
The apex bank explained that CAMF is not applicable to savings accounts, stressing that a negotiable subject to a maximum of N1 per mille.
InsideBusienssNG gathered that Zenith Bank in 2020 generated N21.99 billion from account maintenance fee, 12.05 percent over N19.6billion reported in 2019.
Zenith bank leads the banking sector with higher number of current accounts holders as indicated in its interest expenses that moved from N11.6 billion in 2019 to N29.66 billion in 2020.
GTBank in the year under review reported N12.5 billion from account maintenance fee in 2020, about eight percent increase over the N11.59billion reported in 2019, while UBA’s account maintenance fee moved from N7.15 billion in 2019 to N8.46 billion in 2020.
The Senate had raised concern over current account maintenance fee, stressing that banks are overcharging customers.
The apex bank in 2013 commenced phased reduction of Commission on Turnover (CoT) which terminated with zero CoT charge.
The Director, Financial Policy & Regulation Department, Kevin Amugo, in a circular replaced the CoT with CAMF but subject to maximum of N1 per N1,000/ mille.
The circular was titled, “Introduction of Negotiable CAM fee Not Exceeding N1/Mille.
It stated, “The Revised Guide to Bank Charges (RGBC) which came into effect on April 1, 2013 provides for a phased elimination of COT charges in the Nigerian banking Industry. Under the Guidelines, a zero COT regime was to come into effect from January 2016.”
The CBN noted that while the gradual phase out was being observed, some banks continued to charge Account Maintenance Fees in addition to the reduced COT rate, which in effect amounted to double coincidence of charges.
Report by Insidebusiness.ng