CBN urges Nigerians to take action on commercial banks’ discretionary fees

The Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, has urged Nigerians to take necessary action when commercial banks impose discretionary charges on their bank deposits.

Emefiele, who spoke at the Monetary Policy Committee (MPC) meeting on Tuesday, advised Nigerians to consult the “Guide to Bank Charges”, a document produced by the apex bank to guide bank customers on the discretionary fees.

CIRI reports that the “Guide to Fees Charged by Banks, Other Financial Institutions and Non-Banking Financial Institutions” (the Guide) provides a basis for the application of fees on various products and services offered by financial institutions in Nigeria to their customers. This document applies to all financial institutions licensed and/or regulated by the Central Bank of Nigeria.

The document obtained from the apex bank’s website said the fees prescribed in the guide had been set after extensive consultations with stakeholders.

The intention of the guide is to improve flexibility, transparency and competition in the Nigerian banking sector, the document states.

The apex bank governor, who also spoke about some of the bank’s legacy projects at the meeting, said they would be completed before the administration’s current term expires.

“During the take-off of the Infraco company, transaction advisors and asset managers were appointed. We will conclude shortly with the appointment of the CEO of Infraco. The shareholders also examine the three major projects entrusted to the asset managers. Before the middle of next year, we would take off.

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Meanwhile, the CBN’s Monetary Policy Committee (MPC) kept the benchmark interest rate at 11.5%.

The MPC voted unanimously to keep the monetary policy rate at 11.5% at its meeting on Tuesday.

The MPC also kept the same sentiment for the asymmetric corridor which remained at +100/-700 basis points, and the cash reserve ratio (CRR) remained at 27.5%.

Members of the monetary authority also voted to keep the liquidity ratio at 30.5%, as the governor of the apex bank said the decision to maintain the perimeter was taken to support the resumption of economic growth.

The committee noted that with sustained CBN intervention, economic activity would normalize in the short to medium term, “resulting in improved output growth and reduced inflationary pressure.”

The outcome of the MPC meeting showed that insecurity remained a major concern for members, as they highlighted its impact on investor confidence, foreign investment flows and the economy in general.

Emefiele, who spoke on behalf of the MPC committee, said insecurity “remains a major drawback” and urged security agencies to improve their efforts to build confidence in “the movement of people, goods and services”.

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The MPC expressed optimism that food inflation – which was 18.34% in October 2021, compared to 17.38% recorded in October 2020 – would decrease if insecurity in food producing areas[inthenorthwherebanditsandherdersareattackingmotoristsandfarmersisaddressed[inthenorthwherebanditsandherdsmenareattackingmotoristsandfarmersistackled[danslenordoùdesbanditsetdesbergersattaquentlesautomobilistesetlesagriculteursestabordée[inthenorthwherebanditsandherdsmenareattackingmotoristsandfarmersistackled

Meanwhile, some analysts have welcomed apex banks‘ encouragement to Nigerians to take action against discretionary deductions.

Ene Obi, deputy director of Action Aid and social commentator, said CIRI that most Nigerian consumers do not like to speak up when they are unhappy with the service they receive from their banks.

“This is a welcome development and now that the apex bank has put the ball into Nigerians’ court, I urge them to take the necessary action as outlined in the Guide.”

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