•CBN should sanction banks involved in the unethical conduct
The threat of unauthorised charges on customers’ accounts by banks might soon be a thing of the past if effort by the Central Bank of Nigeria (CBN) to nip it in the bud is effectively sustained. The apex bank’s consumer protection department, at a recent media parley to mark the consumer financial literacy awareness campaign in Enugu rattled the public with disclosures that it recovered N13 billion illegal charges fleeced from customers’ accounts by commercial banks in the last two years.
Hajiya Khadijah Kasim who held forth for Umma Aminu Dutse, director of the department during the parley reportedly disclosed that these untoward sharp practices have led to CBN’s introduction of important banking system reforms to stabilise and sanitise the system. One cardinal component of the reforms is the creation of a consumer protection office in the CBN since 2010, and its subsequent upgrade into a full-fledged department in 2012. The department is expected to help CBN promote a sound and stable financial system as enshrined in its Act, by regulating the conduct of financial service providers to ensure that they deal justly and even-handedly with customers.
Further steps, according to Kasim, have been taken by the apex bank to also engender a bank-friendly environment, including its intervention in ensuring that Commission on Transaction (COT) charges by commercial banks dropped to N2 per thousand naira while plans have been worked out to make sure that it drops to N1 before the year runs out. The goal of the apex bank, according to her, is to achieve zero COT which has been proved to be one of the avenues for shady bank deductions, by 2015.
Without equivocation, bank customers in the country need more of consumer financial literacy awareness campaign that would create a public engagement platform for the apex bank to get important feedbacks and also create awareness and promote financial literacy among bank customers. The current enlightenment campaign is important and should be spread across the country because it will imbue bank customers with the requisite knowledge, skills and confidence to make informed choices and take effective actions that will enhance their financial and economic well-being.
In recent times, the avoidable turmoil in the financial sector of the economy has waned public confidence in banks. And now that the sector is gradually picking up, the idea of consumer protection through a serious beaming of regulatory searchlights on illicit banking activities against customers’ accounts is a move in the right direction. For banks to survive, they need public trust and confidence in their activities. But to achieve this goal, banks also need to be honest in dealings with customers which is currently lacking, especially in view of the scandalous discovery of illegal bank charges on unwary customers’ accounts.
But the discovery of such corporate theft by banks should not be swept under the carpet. There should be specific sanctions if only to serve as deterrence to others contemplating such unethical act. In our view, those banks caught in the act of this corporate theft should be severely punished for they ought not to have made the deductions, without customers’ notice, in the first place. Their unethical acts constitute a flouting of CBN guidelines which might be the reason behind declarations of outlandish and unreal banking profits by some banks in the country.
Henceforth, bank inspectors should be more vigilant because, unlike what obtains in better managed climes, banks in the country have consistently shown no respect for the significant principle of uberimei fidei (utmost good faith) that should exist between them and their customers. This sharp practice should not rear its head again because it is antithetical to economic growth and development.
