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Published On: Mon, Sep 1st, 2014

Reintroduction of ATM charges, in whose interest?

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Emefiele GodwinAs the N65 charges on extended use of other banks’ Automated Teller Machines, ATMs, reintroduced by Central Bank kicked off last Monday, Nigerians have continued to react to a policy many believed is not in the best interest of a growing economy like ours. Etuka Sunday writes:

The business environment in the country has been in intense condition since the reintroduction of charges on ATM usage by the Central Bank of Nigeria (CBN) nationwide.

From the body languages and look on the faces of those in small and medium enterprises, it appears the policy would not be celebrated by this group of people soon. Therefore, questions are beginning to be asked, as to whose interest the policy was intended.

Is the policy for the ordinary Nigerians who are already protesting, or the banks, with CBN inclusive? These are among many questions begging for satisfactory answers.

For those who lack the understanding of the workings of the apex bank, the policy was reintroduced to further mar their businesses or impoverish them.

Some even accused the CBN Governor, Mr Godwin Emefiele who is a player turned referee of trying to help the banks especially his former bank- Zenith to dupe Nigerians.

Nevertheless, the facts must be presented in parts for clarity and better understanding to avoid unnecessary arguments and misapprehension among the mass of Nigerians.

According to CBN’s plan, with effect from 1 September, 2014, Nigerians will be required to pay extra charges when they withdraw money from Automated Teller Machines (ATMs) other than the bank they have an account.

The CBN had on Wednesday, 13 August, 2014, announced its re-introduction of withdrawals from other ATMs.

According to the statement released by the apex bank, the new fee to be paid is N65, a reduction from the N100 that was obtainable before 2012 when ATM’s fees was cancelled.

With the policy, bank customers would be charged N65 on withdrawals over three times in a month on other banks’ ATMs.

This prompted mixed feelings among Nigerians. While some Nigerians especially in Lagos and Jos are against the policy, others commended the CBN for the initiative.

The Director General of the West African Institute for Financial and Economic Management WAIFEM, Prof. Akpan Ekpo, has commended the move by the Central Bank of Nigeria to re-introduce service charge for Automated Teller Machines (ATMs) on inter-bank transactions, saying it is a common practice globally.

Akpan stated that the decision by the apex bank to reintroduce the charges was a welcome development but insisted that the apex should focus on how to bring down the lending and interest rate which he said remained a source of worry for investors.

“When people use ATM of another bank for withdrawal, they should be made to pay charges. So, I believe the decision by the apex bank is a step in the right direction.

However, some residents in Lagos state had faulted the policy and described it as an anti people, a simple but smart means of retrogressing to the former era of heavy charges on transactions via

ATM which the new Central Bank of Nigeria, CBN governor Godwin Emefiele earlier announced he had got rid of.

Across section of the people who bear their minds on the issue said the new policy was against one of the benefits of ATM which is to ensure that bank customers have access to cash as prompt as possible without much stress.

A retired civil servant, Mr Abayomi Adeoye, noted that the apex bank should borrow a leaf from what is obtainable in the western world.

“Nigerian case should not be different in everything; we should maintain consistency of initiatives and policies just as successful countries of the world. I knew that the development emanated from pressures from deposit money banks, but the apex bank should have done the right thing. Emefiele not quite long told us that he has removed all charges on transaction done through ATM, today he is telling again, he is reintroducing N65. I think there is inconsistency in the system”, Adeoye emphasised.

Also, some bank customers in Jos, Plateau and its environs have reacted to the reintroduction of charges on the use of Automatic Telex Machine (ATM) cards describing it as a policy summersault by the apex bank.

Meanwhile, the CBN had explained that the reintroduction of charges on ATM Transaction was to encourage better services to customers.

The clarification the bank said was necessary following mixed reactions from the general public when the announcement of introduction of Fees on Remote-On-Us was made.

The CBN’s Director, Corporate Communications Department, Mr. Ibrahim Mu’azu, in statement said “The Central Bank of Nigeria (CBN) has noted some public comments on its recent circular in respect of fees/charges on the extended use of other banks’ Automated Teller Machines (ATMs).

These reactions have been mixed with most commentators showing great understanding and other stakeholders expressing clear lack of understanding of the rationale for this decision of the Bankers’ Committee.”

According to the statement, transaction volumes at ATMs in other banks’ have increased astronomically due to the free cash withdrawal at other banks’ ATM.

The statement stated that the wear and tear as well as the frequency of servicing the ATMs had increased significantly. This, it stated needed to be tackled to enable the banks carry out their services effectively. It stated that it had been observed that some customers were beginning to abuse the use of ATMs through countless daily withdrawals. “This development has led to increase in cash transactions, which negate the bank’s cashless policy.

“Maintaining ATM is expensive and it requires economic incentive for owners to deploy and maintain these machines,’’ it stated. The statement stated that if part of the cost goes unabated, the banks might be forced to reject transactions coming from their customers at another bank’s ATM.

As the policy kicks off amidst complaints by bank customers, expectations are high for CBN to ensure an effective monitoring of the process so that it is not hijacked by banks with dubious minds.

Again, banks must ensure that their machines are properly serviced and well stocked with cash so that customers are not left stranded or frustrated by the implementation of the policy.

Above all, call centre should be created where aggrieved customers can easily lodge their complaints for prompt and proper redress.

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