CBN GUIDE TO BANK CHARGES 2016.

The Central Bank of Nigeria (CBN) has come out with the draft of a comprehensive guide to approved banks and other financial institutions charges in Nigeria and stakeholders comments are welcome.
According to a noticed dated March 11 and signed by Mr Kevin N Amugo, CBN director financial policy and regulation, all comments put in formal writing should be sent to Regulation department director at most by March 29.
Those inclined to send soft copies of their comments can also do so through abcreview@cbn.gov.ng.
The draft is indeed comprehensive and covers all aspects and virtually all charges attendant on banking and finance operations on behalf of customers.
It could however, be grouped into four groups for easy and popular appreciation. These are transactions for which there should be no charges; the ones in which charges are flat and fixed; the ones negotiable with minimum or maximum limits and transactions in which only attendant cost recovery is allowed.
Services or transactions over which no bank should charge any fee include account reactivation, account closure, mandatory monthly account statements; returned cheques not due to lack of funds; issuance of booklet; withdrawals below CBN stipulated limits; business visit locally; inter branch cash deposits and withdrawals; ATM withdrawals within customers bank; and ATM withdrawals from other banks not more that three transactions in a month.
No charges also for bank draft repurchase, inter branch transfers on behalf of account holders; loan repayment from current or savings account; transfer to other accounts in the same bank and  customers induced debit charges previously known as charges on turnover (COT).
On the other hand, many of the charges are negotiable and banks were duty bound to make customers aware when negotiation is mandatory so as to ensure both parties agree on what is chargeable.
Negotiable  are interest payable on current account balance; term deposits; deposits held as collateral; loans in local currency; interest on authorised overdrafts; facility management fees; facility renewal fees; restructuring fees and commitment fee.
Also negotiable were most inter bank transactions; underwriting; drawings against uncleared effects; equipment leasing; charges on discountable instruments like Bankers Acceptances; current account maintenance fee; and issuance of bond guarantees like bid/tender bonds, performance bonds, and bank guarantees.
There are more. For example, commission on withdrawals from domiciliary accounts; purchase of foreign drafts, commission for confirming inward letters of credit (export); amendment to Form M; and revalidation or extension to LCs; amongst many others.
Most of the negotiable charges have upper limits while some have minimum figures.
There are also many charges that are fixed either in terms of the amount to be paid;as a fixed percentage of value involved or as directed by the CBN from time to time.
In this category are interest payable on savings accounts (30% subject to four maximum withdrawals per month) domiciliary accounts (0.50% for current and savings per annum) default charge on unpaid but due loans (1% per month beyond 7 days grace period); over the counter cheques (N50 per leaflet) foreign exchange sale to customers (interbank rate plus 0.5% margin) and collection charge on foreign denominated cheques (1% of cheque value or Naira equivalent of $10, whichever is lower),
Other fixed charges include LCs processing and registration (N5000 flat); just like for LC verification and authentication by a Nigerian bank; LC rewrite by bank at customers request (0.05% of value starting from a minimum of $25 Naira equivalent); Form A purchase (N100); LCs establishment commission ( 1%; 1.25% and 1.5% of face value respectively for up to 180 days, 270 days and 360 days).
Also fixed are charges for stopped cheques (N500); debit card issuance (N1000); Card maintenance ( foreign currency denominated, N4200 per year and Naira debit card N50 monthly) ATM withdrawal on other banks after third in a month (N65) and mobile money card issuance N100.
In some transactions, banks are expected to recover only cost incurred. These include cheque books issuance; search at Corporate Affairs Commission; obtaining certified true copies of documents; perfection of security for credit facility and issuance of customised deposit booklets.
Henates recommends that all bank customers and stakeholders visit the CBN website to access the full draft and send in comments especially in the light of recent attempt to declare March 1 as bank boycott day in protest against existing charges.