Regarding the delays in addressing consumer complaints, commercial banks, payment system service providers, and other financial institutions have received a severe warning from the Central Bank of Nigeria (CBN).
A recent directive stipulates that banks that do not resolve customer complaints within 72 hours would be fined N100,000 per day. The goal of this order is to ensure that problems, especially those about Automated Teller Machine (ATM) transactions, are resolved more quickly.
The CBN made it apparent that there would be a steep daily punishment if concerns regarding ATMs were not addressed by the CBN or by customers within the allotted 72 hours. If an ATM transaction by a customer fails and the acquirer does not start an automated reversal, the financial institution would be fined N50,000 per day in addition to receiving a full return of the disputed amount.
The CBN’s more comprehensive 2024–2025 monetary, credit, international trade, and exchange policy guidelines, which specify the requirements for banks and other financial institutions that fall under its purview, include this new mandate.
The central bank, which cited the “Guidelines on Operations of Electronic Channels in Nigeria” from June 2020 and the “Guide to Charges by Banks, Other Financial and Non-Bank Financial Institutions” published in December 2019, emphasised its commitment to making sure that all entities in the payment system adhere to established fees and charges.
If contested ATM transactions are not supported by camera evidence, the financial institution will be penalised in an amount equivalent to the amount that was refunded. A bank will be subject to a first fine of N250,000 for an ATM without a camera, and then daily fines of N50,000 until a camera is installed.
The CBN reaffirmed that interest rates for the fiscal year 2024–2025 will continue to be determined by the market and will be indirectly influenced by changes to the Monetary Policy Rate (MPR).
There are several regulations about interest rates on deposits that banks must follow. Interest rates on deposits made into current accounts will remain negotiated between the bank and the consumer. Similar to this, rates for savings account deposits will be based on the “CBN’s Guide to Charges” or any upcoming guidelines or directives from the central bank.
The interest rate on special-purpose deposits, like those used as collateral, will be capped at thirty percent of the MPR for naira-denominated accounts and negotiable for foreign currency deposits.
The declining balance method is also anticipated to be used by banks to compute interest on loans repayable in installments; alternative methods, such as the discount or straight-line methods, which may yield higher interest rates, are prohibited, BrandSpur banking and finance news reports.
Furthermore, monthly account statements that include information about any overdraft accounts, the amount of interest charged, and other account actions during the month must be sent by banks to their clients at no cost to them. There is no minimum balance required to receive interest on savings deposits; interest is calculated daily and credited to customer accounts at the end of each month.
Continuing, the CBN emphasised that banks need to make sure that the charges and interest that are due on deposit accounts are accurate. If errors are found, including nonpayment or underpayment of interest, excessive interest, or unauthorised charges, the bank must reimburse the customer within two weeks and pay simple interest at the highest lending rate currently in effect at the CBN.
In addition, the offended client must get a letter of apology, and if required, their account must be rebuilt. If banks do not follow this regulation, they will face further fines. Comparable guidelines apply to accounts denominated in foreign currencies.
When non-payment or underpayment of interest is detected, banks are required to issue an apology and reimburse the impacted customer with simple interest at the foreign currency lending rate set by the CBN. Again, there will be consequences for noncompliance.
This extensive collection of guidelines demonstrates the CBN’s dedication to safeguarding the interests of its clients and making sure that financial institutions follow industry best practices when handling client money and settling conflicts.
