BVN: Exercise should go on indefinitely - CBN

Customers yesterday got a breather on the Bank Verification Number (BVN), with the Central Bank of Nigeria (CBN) directing banks to ensure their uninterrupted enrolment on the platform.

CBN Governor, Mr. Godwin Emefiele

In a statement signed by its Director (Corporate Communications) Ibrahim Mu’azu, the CBN said although the time frame for the initial enrolment had elapsed, the exercise should go on indefinitely.

The BVN, which captures bank customers’ biometric data, such as  fingerprints, provides unique identification for them and equally protects their accounts from unauthorised access, identity theft and fraud.

Customers who are yet to register are required to do so to avoid restrictions on their accounts.

“Account holders who are yet to obtain their BVN are enjoined to visit their banks and do the registration. There are two steps to the BVN process. The first step is to obtain a BVN while the second step requires the account holder to link the BVN with his or her bank account(s),” he said.

Mu’azu said an individual could enroll for a BVN without necessarily having a bank account. Such individual can then submit the acquired BVN at any bank he/she wishes to open an account.

He said linking BVN to bank accounts is now a one-stop-shop which enables account holders to register and link their BVN to their accounts in one location, irrespective of the banks in which they have their accounts. All these are aimed at making the process as seamless as possible.

“The BVN is neither a payment instrument nor an account number and therefore cannot be used to access any account by unauthorised users,” Mu’azu said.

BVN: Exercise should go on indefinitely - CBN

BVN: Customers close account to avoid backlash

As the October 31st deadline for the enrolment for the Bank Verification Number (BVN) ended yesterday, many banks across the federation were swarmed with customers on Friday to complete their BVN just as many closed down their accounts to avoid any backlash.

CBN Governor, Mr. Godwin Emefiele

When The Nation visited some banks within Lagos metropolis and its environs, customers’ turnout was massively high.

In Festac town, Mushin, Ikeja, Yaba, Maryland, Ojota, Ketu, Mile 12, Ikorodu and its environs, most of the banks were overflowing with customers who were desperate to be captured.

At Zenith Bank premises in Matori, Mushin area of Lagos, bank officials sweat it out to enrol customers for the BVN, as most of the customers formed long queues.

The Central Bank of Nigeria (CBN) had extended the deadline for the BVN exercise to October 31 after banks were inundated by last minute customers to beat the earlier deadline back in July.

The Nation was reliably informed that the bank had anticipated the rush and had made provision with about three staff members handling the exercise of registering such customers outside while other banking activities went on inside.

Adeolu Olugbemi, a customer in one of the new generation banks told The Nation that due to his busy schedules he couldn’t complete the BVN exercise hence he was forced to close down his bank account.

He said, “several times I came to my bank with the intention of doing my BVN but each time I came the whole place was overflowing with crowd and since I couldn’t withstand the drudgery of standing on the queues for hours I had to close my account today (Friday). I can’t afford to face CBN penalty.”

Another customer who simply gave his name as Stanley told our correspondent he also couldn’t complete the BVN. “I was at the bank yesterday (Friday), when I got there, they ask us to pick numbers and I was 120 on the queue. After waiting for over one hour it still didn’t get to my turn so I had to close my account with the bank as suggested to me by one of the bank officials,” he said.

An official of Diamond bank in Wuse who also preferred not to be mentioned said although there was an upsurge of customers rushing to beat the deadline for the registration it was nothing compared to the previous deadline. She said the bank had made provisions and would ensure that they attended to all the customers at the bank for the registration.

At GT Bank Area 3 Garki, over 20 customers were seen waiting to either register or submit their BVN to the bank. One of the bank’s customers, Miss Onyeche Audu said, “I am just entering the bank and I am sure I will leave here soon because the bank is really managing the crowd.”

However, there were very few customers trying to carry out the BVN registration at Eco, Zenith, Fidelity, Stanbic IBTC and Unity banks.

Speaking with a cross-section of the officials of these banks, they confided in The Nation that they were optimistic that “after the registration, the CBN would get the cards ready after which the banks would distribute them to their customers.”

Meanwhile, a few hours to the close of banking business on Friday, the CBN issued a statement warning unsuspecting customers of the activities of those it described as “certain unscrupulous individuals sending unsolicited mails and text messages to unsuspecting bank customers, alerting them to the deactivation or suspension of their bank accounts due to uncompleted Bank Verification Number (BVN) registration process.”

The apex bank warned individuals and the general public that such “messages are intended to lure bank account holders to reveal their personal details with which the fraudsters could use to defraud them.”

The CBN and deposit money banks nor their employees or agents the statement said “would mever call bank customers or send e-mail/text messages requesting for passwords, card details or personal identification number (PIN).”

BVN: Customers close account to avoid backlash

32m Nigerians yet to enrol for biometric verification one month to deadline, says CBN

The Central Bank of Nigeria (CBN) has said that 32 million active bank accounts have yet to be enrolled on the Biometric Verification Number (BVN) by September.

CBN Governor, Mr. Godwin Emefiele

In a statement in Abuja, on Friday, Mu’azu Ibrahim, CBN Director, Corporate Communications, said CBN was concerned by the number of account owners yet to enrol, considering that the exercise would end by October 31.

The News Agency of Nigeria (NAN) recalled that the CBN, in collaboration with all banks in Nigeria, on February 14, 2014, launched the BVN, which is a centralised biometric identification system for the banking industry.

It aims at addressing issues of identity theft and fraud and will help to discover blacklisted customers, reduce queues in banking halls and standardise efficiency of banking operations.

The CBN also said the BVN would encourage banks to grant loans to Micro, Small and Medium Enterprises (MSMEs) and students in the country.

“One of the most potent arguments advanced by banks for not extending enough credit to prospective credit customers in Nigeria has been the absence of credible identity system.

“Thus, it was agreed that the scheme would make access to credit easier for low income earners in the society,” the apex bank said.

The CBN had initially put the deadline of BVN registration at June 30 but postponed it to October 31 because of low enrolment.

According to the statement, after 18 month of the exercise, empirical evidence shows that a good number of bank customers are reluctant and have not taken the exercise seriously.

“The emerging statistical trend of the BVN registration exercise shows that there are about 52 million active bank accounts in various banks.

“Out of this, total enrolment stands at about 20 million, out of which about 14 million accounts have been found linked to the BVN as of September.

“The question now is whether bank customers have been taking advantage of the extension to complete their BVN registration and also ensure that their various bank accounts have been linked to the BVN,” it stated.

The statement revealed that after the initial rush from June ending to July, there had been a steady decline in new BVN enrolment figures for August and September.

It stated that the development indicated that many bank account holders had continued to show apathy instead of taking advantage of the extension period to complete the registration.

“Bank customers are urged to take advantage of the remaining time to complete the registration. This is so as to avoid the commotion and melee experienced at various banking halls in the month of June.

“The CBN has made it clear that there would not be further extension after the October 31, 2015 deadline,” the statement said.

It said this meant that customers without the BVN-linked accounts might risk being restricted from normal operations of their accounts or access to their bank account balances.

32m Nigerians yet to enrol for biometric verification one month to deadline, says CBN

Loans: Banks put up debtors’ property for sale

Some of the Money Deposit Banks in the country have compiled for sale the lists of houses, hotels, filling stations, schools, among other property used as collateral by debtors in a bid to recover their capital.

CBN Governor, Mr. Godwin Emefiele

The banks, in a name and shame manner, had earlier in the week published the lists of chronic debtors who were unable to meet up with the July 31 deadline given by the Central Bank of Nigeria to repay their loans.

So far, 17 banks had published the names of their delinquent debtors and of the N175.61bn being owed the banks, First Bank has N43.72bn non-performing loans; Unity Bank, 45.52bn; Access Bank, N3.4bn; Diamond Bank, N47.17bn; First City Monument Bank, N17.1bn; Ecobank, N5.4bn; UBA, N9.3bn; and Wema Bank, N1.26bn.

While the Assets Management Company of Nigeria, Standard Chartered Bank, Keystone Bank and others are waiting to publish their lists of debtors next week, the total number of debtors so far released by the banks, after removing some names due to litigation and last-minute renegotiation, is 606.

However, investigations by Saturday PUNCH revealed that apart from publishing the debtors’ names, some of the banks had concluded plans to sell real estate assets used as collateral by debtors and had already engaged the services of estate firms/agents to dispose them.

A document, exclusively obtained by Saturday PUNCH, lists 43 property put up for sale by Sterling Bank with a total value of over N3bn.

The property include a five-bedroom detached house located in Magodo, Lagos, and offered for N105m; a hotel in Osogbo, Osun State, N241m; a two-wing duplex in Lekki Phase 1, N150m; a storey building in Garki, Abuja, N172m; a storey building in Ibadan, Oyo State, N30m; and a commercial/residential property in Ilorin, Kwara State, N70m.

Also, there is a storey building in Akwa Ibom State, N29m; a filling station at Owode/Idi-Iroko Road, Ogun State, N2.8m; detached blocks of flats, duplex and school halls at Asaba, Delta State, N135m; a block of flats and other adjoining property in Asaba, Delta State, N135m; a detached house in Maitama District, Abuja, N305m; and a bungalow in Benin City, Edo State, N14m.

Some estate surveyors and valuers, who confided in one of our correspondents, affirmed that they had received instructions from some of the banks to help them dispose the property which are spread across the country.

While some of the surveyors admitted that they had received the property lists directly or indirectly from the banks, some others said some of the banks had contacted them to do same even before the names of debtors were published, noting that the exercise started shortly after the three-month grace period given to the chronic debtors by the banks.

While real estate firms guided the information pertaining to the properties put up for sale by banks in order not to erode the confidence the banks have in them, sources in top real estate firms noted that almost all the banks are selling real estate assets owned by bad debtors.

They told Saturday PUNCH that Skye Bank had also released a list with twice the number of properties on the Sterling Bank’s list with most of them being choice properties in the Lagos metropolis.

Estate agents and lawyers, who spoke with Saturday PUNCH under the condition of anonymity, mentioned Keystone Bank, FCMB, and UBA as some of the banks from which they had received briefs on properties marked for sale.

Since real property is usually the most acceptable collateral by financial institutions, one of the surveyors, Olu Adeyemi, explained that due to the desperation of the banks to recover their capital within the shortest possible time, they had given their lists of property to as many firms as they could trust to fast-track the sale.

He said, “It is not like the lists of the property are in the public domain, but for those who have some of these affected banks as clients, the banks have made available lists of the properties, including the addresses, copies of the title documents, prices and some other information that a willing buyer might need.

“For example, I have lists from two of the banks that I am working on already, but the problem is that the market is slow.”

Another surveyor, who spoke under the condition of anonymity because of the confidentiality of the information, explained that some of the banks had already offered the property for sale before the lists of debtors were published.

He added that the idea of banks offering such properties for sale was not entirely new, and expressed concern that the properties would be offered below their market values and the actual sale might not come readily because of the state of the economy.

He said, “Before they started publishing the lists of the debtors, some of the banks have offered the property for sale, and once we found a buyer, we contacted them and they (the bank) informed the owner, who would be left with the option of paying them or forfeiting the property.

“As you may know, such property is offered below the market price so that the banks can recover their money after the sale. When we do valuation for banks, we give them the property’s open market value and the forced sales value, which is the price at which the property can easily sell in the open market, and it is usually the two-third of the market value of the property as of the date of the valuation.

“With the availability of these properties at reduced prices, we are optimistic that we will get buyers because the economy is not very good at the moment.”

Another estate surveyor based in Port Harcourt, the Rivers State capital, spoke with Saturday PUNCH under the condition of anonymity. She explained that apart from the commercial banks selling debtors’ property, some microfinance banks had also been doing same.

She said, “Apart from the lists given by some of the commercial banks with bad debts, I know that some microfinance banks are also in crisis and are offering their debtors’ property for sale.

“They gave us a list but we have not made much progress on the sale because people are not buying due to the economic crisis and the dollar to naira exchange.

“Even though I have not received any instruction from any of the commercial banks, my colleagues told me about it and we are working together to help dispose them. So, I can tell you that it is true. There are a number of them in the market now, including those that have been there already, but selling them is another issue.”

In the past, organisations like the Asset Management Corporation of Nigeria and some other financial institutions had offered properties used by the debtors as collateral for sale in a bid to recover their loans.

AMCON in 2013 offered for sale a private aircraft said to belong to the chairman of a popular oil marketing firm as settlement of his indebtedness to the corporation.

Commenting, the Principal Partner, Bode Adediji and Partnership, Mr. Bode Adediji, explained that the idea of selling properties to amortise a loan was a global practice and not limited to Nigeria.

Adediji, who said the affected banks would need to consult professionals to advise them on their actions and reactions to the issue, noted that not all the names on the lists published by the banks could be bad debtors, but that some could have ventured into businesses that failed.

He said, “For us, instead of jumping in to go and sell for them, we have been telling them what to do, in terms of guidelines because it is better to avoid issues relating to forced sale of property belonging to debtors through professional platform, collaboration and cooperation.

“It should also be noted that not all the people on the published lists are bad debtors. It just happened that a number of them went into business that did not thrive. For all these banks to make progress in this matter of selling assets of debtors to recover loans, let them consult professionals.”

A lawyer and rights activist, Mr. Liborous Oshoma, in a telephone interview with Saturday PUNCH, said, “It is not the first time that debtors’ property foreclosed by the banks are being put up for sale, but efforts have only been doubled in recent weeks because of the level of bad debts and the fact that there is no money in the system.”

A former CBN Deputy Governor, Mr. Tunde Lemo, averred that selling properties used as collateral by banks was in line with global practices as long as the action is within the confines of the terms of the loan.

He also explained that there should be a legal framework and infrastructure in place that would ensure that banks would be able to realise their security with relative ease.

He said even though the list would not be able to distinguish between those who were determined to default and those helpless, the intention of the CBN to publish the names of defaulters should not be misunderstood.

He said, “Selling properties used as collateral is allowed. If someone owes and he has violated the terms of the contract, banks should feel free to realise their security, but they should act within the terms of the agreement.

“The CBN should not be criticised at this point over the publishing of the names. Its intention is understood. It has become very important to deal with serial borrowers and do something to check irresponsibility on the part of borrowers, who just think banks’ money is for them to take. That is not good enough.

“It is also important to note that perhaps there are better ways of dealing with those who don’t want to pay because some may be unable to pay due to the dire economic circumstances, which may be outside their control, while some may have fraudulent intention. Thus, a publication like this may not distinguish between the two.

“There may also be issues around clerical error and accuracy that could make someone’s name appears in the paper which ought not to be and there are also marginal customers who may be struggling to pay, but whose business would be affected by the publication. These are what we call unintended consequences.

“However, it is not about whether it is right or wrong, what we should look at is the legal framework and infrastructure as well as the official platform that will ensure enforcement of property rights and disposition of cases in court, such that banks are enabled, as it is in other climes, to realise their security with relative ease, then there may not be need for this.”

When contacted, spokespersons for Skye Bank, UBA, Zenith Bank, and First Bank, among others declined to comment on the issues. Calls, emails and text messages sent to them had yet to be answered as of the time of filing this report.

Loans: Banks put up debtors’ property for sale

Uproar as Nigerians in UK pay N10, 000 for BVN

Nigerians in London, United Kingdom, have expressed frustration over the compulsory payment of £30 (about N10, 000) for the registration of the Bank Verification Number, as directed by the Central Bank of Nigeria.

CBN Governor, Mr. Godwin Emefiele

Apparently sad over their plight, some of them during the week stormed the Nigeria High Commission in London to protest against the directive of the apex bank. Others took to the social media to vent their anger.

The CBN had recently extended the deadline for the BVN registration from June 30 to October 31, 2015 as disclosed in a circular issued to all deposit money banks operating in the country.

The Director, Banking and Payment Systems Department of the CBN, Mr. Dipo Fatokun, said the extension became imperative in order to give bank customers more time to participate in the enrolment exercise.

The circular had read in part, “It has come to our notice that the BVN registration has elicited tremendous interest from the Nigerian banks’ customers who crowded the banking halls in order to beat the deadline.

“Furthermore, there is the need to give Nigerian banks’ customers in the Diaspora ample time to enrol on the programme. The guideline for their enrolment is being finalised and will be released soon.”

Though the BVN registration in Nigeria is free, Nigerians living in London have had to part with N10, 000 to enrol on the exercise.

The directive was said to have been issued by the apex bank, as confirmed by the UK chapter of the All Progressives Congress and Zenith Bank.

The APC, UK chapter, had asked the bank on Twitter about the authenticity of the directive and the bank replied, saying, “The letter is genuine. The fee is as communicated by CBN and the enrolment company was contracted by the CBN. We trust this helps.”

Meanwhile, a user of a popular blogging platform, Nairaland, by the name klem93, said he was shocked to have seen photos of Nigerians thronging the Nigeria High Commission in London in frustration.

He wrote, “I thought it is going to be smooth sailing as I read that BVN for Nigerians in London had begun. I didn’t know it is going to be the same way as it went in Nigeria. A reader of my blog who lives in London wrote me an email: ‘The Nigeria High Commission in London needs an urgent overhaul. This afternoon, we Nigerians were treated like animals in Fleet Street, London, all because we wanted to do BVN for those of us who have accounts in Nigeria.

“Things soon became chaotic and someone called police on us. They allowed us to converge on the street and then locked us out. We were also being forced to pay £30.00 each, but none of the officials or the website could explain what the money was meant for. Is it not free in Nigeria?”

Eleojoe23, another user of the platform, protested, “£30? What for? They truly deserve an explanation. Maybe the high commission thinks that since they live in London, they should have enough money to spare. Do they think people just go out and pick money on the streets in London?”

Another user of the platform, Julioralph, said, “30 pounds for what? Members of staff at the high commission should be changed. Even the CBN is at fault as well; they don’t have proper plans for those abroad concerning this BVN stuff.”

Attempts to get the comment of the ministry’s spokesperson, Ogbole Ahmedu-Ode, were not successful as he could not be reached on the phone. He also did not respond to a text message that was sent to him.

But investigations at the Ministry of Foreign Affairs showed that the ministry was not involved in the BVN registration held in the UK.

A highly placed official in the ministry explained that the Nigeria High Commission in UK was not involved in the BVN registration, stressing that it was handled by a private firm which has no relationship with the embassy.

The source said that the high commission officials saw the posters advertising the BVN registration in London like other members of the public, noting that the “BVN registration was the private affair of a private company.”

“Neither the Ministry of Foreign Affairs nor the Nigeria High Commission in the UK was involved in the BVN registration; the programme was handled by a private company which has no relationship with the ministry or the high commission,” the official said on Friday.

Also, the Director, Corporate Communications Department, CBN, Mr. Mu’azu Ibrahim, could not be reached for comments as repeated calls made to his mobile phone did not connect.

Uproar as Nigerians in UK pay N10, 000 for BVN

CBN extends BVN deadline

The Central Bank of Nigeria has extended the deadline for the Bank Verification Number exercise till October 31.

A statement by the CBN said the decision to extend the BVN registration was due to passionate appeals from the public for the extension of the exercise after the expiration of the earlier deadline on Tuesday.

The apex bank said it noticed with satisfaction the level of compliance among the banking public and also acknowledged the difficulties which the people have gone through in the last few days in the quest to beat the registration timeline.

It added that arrangements are being made to enroll bank customers in Diaspora in the next few days.

CBN extends BVN deadline

Different tactics Nigerian banks use in defrauding customers discovered

Francis Agadaga still remembers events of that fateful evening. He could have been a widower by now. On September 12, 2014, he rushed to an Automated Teller Machine point in his neighbourhood at Igando, a Lagos suburb, to pick some cash with which to take his ailing wife, Sandra, to the hospital. It was a tough period for the family. The N7, 850 left in his bank account would go a long way in dousing the situation if he could get access to the fund. After inserting his card into one of the ATMs and requesting to withdraw N7, 000, what followed almost left the father of two in tears.

CBN Governor, Mr. Godwin Emefiele

“It was on a Sunday afternoon and we had just returned from church when my wife started feeling feverish,” he began. “Her temperature became so high that we needed to quickly rush her to a hospital. I didn’t have any money on me at the time and so I hurried to the nearest ATM point to withdraw the little money I had in the account.

“However, to my utmost shock, I got a debit alert but did not get any money from the machine. I was so confused and tensed because I had never experienced such before and the kind of situation on ground then was a matter of life and death,” he said.

After waiting for a while to see if the cash would pop out of the machine, Agadaga left the place heartbroken and more tensed than he ever was. It took the kindness of few neighbours and friends to raise the money needed to save his wife’s life at a private clinic she was rushed to for treatment.

“It was my neighbours and friends who helped to raise N8, 000 with which I took her to the hospital where she was given injections and drugs. The next day, I went to my bank to complain and bank officials promised to reverse the debit after I had filled a form.

“I went back there after about a week later to find out why the money had not been reversed as promised. I was told their system had some technical problems, which they were trying to fix. I decided to give them some more time for the problem to be rectified. But after going there several times and being told the same thing, I left everything to God.

“Since that period till now, my N7, 000 has not been refunded. If not for my neighbours and friends who helped with some cash that day, maybe my wife could have died from that sickness,” the disgruntled young father told Saturday PUNCH.

Like Agadaga, Ejiro Dumuje, is still waiting for her money to be reverted back to her account four months after she was wrongly debited by an ATM in Abeokuta, the Ogun State capital. Dumuje had visited the ancient city to purchase bales of Adire fabric to resell in Edo and Delta states where she shuttles frequently when she suddenly ran out of cash. She headed for the nearest ATM point to collect some money. After paying her initial request of N40, 000, the young lady decided to pick additional N5, 000 from the machine. That was where things went wrong. A debit alert was sent to her phone but the machine never paid that money. Four months on, Dumuje is still waiting after several complaints at her bank.

“I have been to my bank more than three times to complain and ask why my money has not been refunded,” she said. “The people at the customer care just try to calm me by assuring that the case was still under investigation and that a refund would be effected as soon as possible. This is the fourth month and I have not seen my money. I am tired of going to complain. If they like, they can pay and if not, I leave them to God,” the visibly enraged lady said.

Bayo Odesina was in his office in Lagos in December 2013 when he got a debit alert of N250, 000 on his phone. It was an alert for an online transaction carried out through his MasterCard in Flushing, New York, United States of America. Agitated by the development, Odesina phoned his account officer to complain about the development and followed it up by contacting his lawyers to write the bank.

The financial institution replied and asked for a three-month period to properly investigate the matter. After three months, the bank sent a letter to Odesina’s home, accusing him of negligence and carelessness for the act. According to the bank, he had compromised the Personal Identification Number of his ATM card, thereby allowing fraudsters access to it in the process. Meanwile, it was only a few days after Odesina had approached his bank to block his ATM card after it went missing. The bank simply absolved itself of any blame in the act.

Odesina’s lawyers wrote the bank again, threatening to take the matter to court if their client’s money was not refunded. In response, the bank requested for more time, apparently trying to frustrate the matter. One year passed and nothing changed. Odesina, a media practitioner, wrote the bank’s corporate affairs unit, this time, introducing himself as a journalist and highlighting how much damage a publication of the matter could do to the bank’s image. That same day, he was contacted by the head of the corporate affairs unit, who strongly assured him that his money would be refunded in a few days time after talking him out of publishing the matter in the newspaper where he worked. Three days later, an alert did come on his phone. His money had been refunded after about 13 months of intense struggle.

“Their plan was to make me forget about the money,” Odesina told Saturday PUNCH earlier in the week. “They kept using all sorts of delay tactics just to frustrate me so I could give up on the money. If it were N5, 000, maybe I would have forgotten about it, but N250, 000 is not something I could just let go like that because it was a lot of money.

“My only saving grace was that I am a journalist. The bank already accused me of being careless with my ATM PIN. They also said that I had released vital information of the card to fraudsters who then went ahead to make online purchases with it in the US. The card in question had got missing and I made a request for it to be blocked, so how could that same card be used to make any transaction if not through the help of an insider in the bank who knew how to bypass certain security systems put in place?

“When I realised that the bank was not going to pay my money back, I contacted the people at the corporate affairs unit and made them understand what damage a news of the entire drama could do to the image of their bank. That same day they called me and pleaded with me to give them a few days and that they would pay me back my money. Three days later, I got an alert of N250, 000 on my phone. That was one year and one month after the initial incident. Imagine if that was all I had in the bank or I had not pursued the matter vigorously, I could have lost that much to the bank. I have since closed down my account with the bank,” he said.

A young factory worker in Akure, Ondo State, Yemi Onanuga, was stunned recently when N11, 300 was deducted from his account by his bank for an insurance scheme the financial institution claimed he subscribed to earlier. The money was part of funds he had been saving for months to establish a salon.

“I was shocked when I received the debit notification because I never subscribed to any insurance scheme at any period. It took several months of complaint and repeated visits to the bank before my money was paid back into my account. It was a terrible experience that really affected me in several ways,” Onanuga toldSaturday PUNCH.

Illegal deductions as these are now a common feature despite series of complaints from many bank customers across the country. While some have been lucky to have their funds returned into their accounts, others continue to lament in vain. For them, it is a refund that might never come.

Three weeks ago, Amarachi Ejindu went to an ATM at the Akowonjo area of Lagos to withdraw some money. Though, her money was reversed back after receiving a debit alert initially for the transaction, the N65 ATM charge was not. It took a while before Ejindu noticed this and when she did, no reasonable explanation came to her mind. Why should she be charged for a transaction that was never completed or even occurred, she wondered. Why was the N65 not refunded along with the amount reversed? Who does that money go to? What does the CBN say about this? The questions kept running on her mind.

“I was really concerned about this that I had to call my bank’s customer care on the phone,” Ejindu opened. “It is a small amount but then I imagined why I should be charged for a transaction that never took place. It sounded like a rip off to me. I called the customer care people and they could not give a satisfactory explanation for this. They told me to make a formal complaint and that the matter would be looked into. I did that but they have yet to refund that money. Indeed, N65 could look like a small amount but think about how many customers would have experienced the same problem in a day and then see how much the banks could be making off people without their knowledge,” she said.

In Ilorin, the Kwara State capital, Abdullahi Lawal, an undergraduate, did not also get his N65 back after a cash reversal on his account two months ago. It was on a Friday evening and the 23-year-old had visited a cash point in the city to pick some amount to transport him to Ibadan in Oyo State where a cousin was getting married that weekend. During the transaction, Lawal was debited N4, 000 which was soon reversed back into his account. Like Ejindu, he noticed that what came back to him was N65 less. There was nobody he could complain to, so he forgot about the matter and moved on.

“When I noticed that N65 was still missing from my account after the reversal, I decided to let go as it was a small amount and moreover, there was nobody I was going to complain to that day. If it were a bigger amount, of course I would have gone to the bank to complain. I have forgotten about it because I am not sure the bank will refund the money,” Lawal said.

Apart from the N65 ATM charge, customers are also made to pay for multiple Short Message Service alerts for a single transaction on their bank accounts, losing more of their funds in the process. Many of these charges are not even communicated to the unsuspecting customers by the financial institutions.

A social economist, Kabiru Tiamiyu, told Saturday PUNCH that with all kinds of deductions being carried out in the name of charges by Nigerian banks, it is almost impossible for customers, especially those running savings accounts to get back the exact amount they kept in the banks.

According to Tiamiyu, one of the easiest ways banks milk unsuspecting customers is through SMS. He said banks still charge N4 per SMS sent to a customer when even bulk SMS providers in the country offer the service for less than N1.00. Rip-off of this kind, he said must be resisted by customers.

Following a directive by the Central Bank of Nigeria, bank customers began paying N65 for cash withdrawals made on other banks’ ATMs from September 1, 2014. The re-introduction of the charges came almost two years after the CBN and the Deposit Money Banks cancelled the N100 ATM charge in December 2012. According to the apex bank, the charge would become effective on the fourth ATM withdrawal in a month, thus making the first three withdrawals on other banks’ machines within the month free.

But financial experts think that the N65 deduction should only apply to valid withdrawals. According to Godfrey Obiefule, an investment banker, returned cheque debits, bank-generated charges and loan liquidation are transactions that ought not to attract Commission on Turnover. He posited that reversals or mistakes made by banks should not attract charges to the depositors.

In 2013, the CBN disclosed that it recovered over N9bn excess charges deducted from customers’ accounts by commercial banks across the country within a one year period. The controller of the Abeokuta branch of the apex bank at the time, Mr. Olumuyiwa Joawo, made the revelation during a consumer sensitisation workshop organised by the financial body in the Ogun State capital.

Head, Security and Risks Management, Credit Dynamics, Kingsley Ochefu, wants customers to be more vigilant in their dealings with financial institutions and always complain whenever they notice any discrepancies on their accounts.

“Banks should let their customers know their service charges for accounts.

Deputy Chairman, Committee of E-banking Industry Heads in Nigeria, Mr. Dele Adeyinka, toldSaturday PUNCH that the N65 ATM charge is shared by several parties regardless of whether the transaction succeeds or not.

“The N65 in question is shared by several parties. Out of the amount, N10 goes to the issuer of the card while N55 goes to the bank that owns the machine.

“The truth is that whether a dispense error occurs or not, there has been a communication link, the switch has been touched and the owner of the ATM incurred some cost to set up the machine. That communication has to be paid for because there are implicating charges for the process involved.

“For a customer such could be a failed transaction but in the real sense a communication link between the ATM and your bank had occurred, switch had been touched and these services attract charges whether or not the request was eventually completed. A service has been offered technically.

“But this is the fault of nobody. It is simply as a result of infrastructural failure in our society. Banking transactions rely on a lot of infrastructure to thrive especially stable power supply. This is part of the reasons why the situation persists,” he said.

On the issue of charging customers for multiple SMS on a particular transaction, Adeyinka said it was wrong for banks to do such as it was not the fault of the customers. According to him, customers who experience such should make formal complaints at their banks or petition the CBN who would surely look into it.

CBN spokesman, Mr. Ibrahim Muazu, told Saturday PUNCH that whoever feels cheated by their bank should write the regulatory financial institution and their grievances would be looked into immediately if the case is valid. Like Adeyinka, he explained why the N65 ATM charge does not return back to a customer’s account even when a transaction is not completed. He disclosed that as long as a communication link has had been established between the two banks involved, charges are definitely going to apply.

 

Culled from Punch Newspaper

Different tactics Nigerian banks use in defrauding customers discovered

CBN fines banks N1.2bn for violating agric credit scheme

The Central Bank of Nigeria (CBN) has fined banks N1.2 billion for violating the guidelines of the Commercial Agricultural Credit Scheme (CACS). Meanwhile, 165,510 jobs has been created through the scheme since inception in 2009.

This was revealed in the apex bank’s report on the activities of the scheme for last month. The report stated, “Access Bank was fined the sum of N353.395 million being sanction for infraction of the CACS Guidelines during the month. Cumulatively, the total penalty charged for infractions, stood at N1.242 billion from inception in 2009 to May, 2014.”

According to the report, the major challenges confronting the scheme are, “Non-adherence to CACS guidelines by banks, and Poor monitoring of projects by some participating banks.”

The report stated, “The Commercial Agriculture Credit Scheme (CACS) was established to finance large ticket projects along the agricultural value chain. The Scheme is being administered at a single digit rate of nine per cent to beneficiaries for a period of seven years. State Governments, including the FCT can access a maximum of N1.0 billion each for on- lending to farmers’ cooperatives or other areas of agricultural intervention.

“No fund was released from CACS Receivables Accounts during the period under review. However, the sum of N229.282 billion has so far been released to the economy under CACS in respect of 304 projects through twenty banks made up of N199.831 billion from CACS Receivable Account for 273 projects and N29.451 billion from CACS Repayment Account for 31 new projects and 15 enhancements.

“The sum of N701.41 million was released from the CACS Repayment Account to two participating banks for two projects in May, 2014.   304 beneficiaries made up of 274 private promoters and 30 State Governments including the FCT has been sponsored under CACS. The sum of N39 billion has been accessed by 30 State Governments and the FCT.     The sum of N2.340 billion was repaid by two banks in respect of three projects during the month, bringing the total repayment to N39.888 billion in respect of 74 projects. The balance on CACS Fund as at end of May, 2014 was N0.169 billion. The balance on CACS Repayment Account as at end May, 2014 was N10.437 billion.

“Analysis of CACS performance by value chain showed that out of the 274 CACS private sector sponsored projects (from both receivable and Repayment Accounts), production dominated the activities funded with 50.73 percent, followed by processing which accounted for 38.59 percent, while marketing, storage and Input supplies accounted for 5.47 percent, 4.74 percent and 0.36 percent respectively. In terms of the volume of funds released, processing accounted for 50.2 percent, followed by production which accounted for 34.8 percent. Marketing, storage and input supplies accounted for 10.6 percent 4.2 percent and 0.3 percent respectively.”

 

CBN fines banks N1.2bn for violating agric credit scheme

Senate confirms Godwin Emefiele as new CBN governor

By Ehi Ekhator

The former Managing Director of Zenith Bank Plc, Mr. Godwin Emefiele has been confirmed by the Nigerian Senate on Wednesday

Godwin Emefiele

as the new Governor fo Central Bank of Nigeria (CBN)

Emefiele was nominated by President Goodluck Jonathan on the 20th of February, 2014, the same day the former CBN Governor, mallam Sanusi Lamido Sanusi was fired after being accused of financial recklessness and misconduct

The Senate President, David Mark confirmed the nominee and added that Emefiele would lead the bank without fear or favour.

He is to take over from the acting CBN governor, Dr. SArah Alade, the most senior deputy governor at the bank who worked under Sanusi Lamido.

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Senate confirms Godwin Emefiele as new CBN governor