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How public-serving is the reintroduction of the N65 ATM fee?

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by Ugochukwu Ugwuanyi
It is unfortunate that in a matter of hours, the Central Bank of Nigeria,

CBN, would have made good its earlier notice of reintroducing charges on

ATM withdrawals. Since over a fortnight ago (Wednesday 13th of August

2014) when the plan was made public, I had deliberately stayed my comment

on it because I was hoping that the wide criticism that greeted the policy

would make the apex bank reconsider its stance. I am disappointed that

this is becoming another case of: let them have their say, while we have

our way.
One may think the public outcry against the decision is not loud enough to

warrant the back tracking of the apex bank on the matter. I don't think

that is true. If actually Nigerians werent vociferous enough in

repudiating the policy, the central bank wouldnt have come up to defend

why the N65 charge had to be introduced just days after it announced the

decision. But then, the justification it gave cannot survive the test of

critical analyses. It equally flies in the face of common sense.

Please, dont be misguided by my opening sentence. In as much as I

consider it unfortunate that the policy looks set to take effect, I will

try as much as possible to dispassionately stick with the issues. To boot,

let me clarify my disappointment with the development. The use of ATM and

issues about it have come to be one that affects virtually every member of

the already pauperized populace of Nigeria. Whatever goes on with it has a

direct bearing on them.
Mind you, my reference is to the same people who have surrendered the

commonwealth of the country to the ruling class as well as the elites to

help themselves with as they please. They have admitted in good faith

their helplessness when it comes to deriving a good bargain from those in

charge of the common till. Why then are they still being subjected to this

kind of policy that takes from their precious little and gives same to

those who are already extremely rich? I'm taking about those who commute

in private jet!
I expected those pushing for the new fee to come up with a better defence

that would wear well with those who would suffer the brunt. This explains

my disappointment with their second rhetoric. However, let us still

commend them for coming up with a defence since it is typical for we

Nigerians to appreciate inconsequential acts of modesty from our leaders.

But while we acknowledge them, let us inform CBN that we are still lost as

to why it would reintroduce a policy which banks chief executives opted

to remove out of their own volition. For those who may have forgotten,

time was when we used to forfeit the sum of N100.00 each time we conducted

a “remote-on-us” ATM transaction. This held sway till as recent as

December 2012 when the CBN in collaboration with the Bankers Committee

abolished the N100 fee and transferred N65 out of that cost to the issuing

It is this N65, which was hitherto borne by commercial banks, that

Emefieles CBN has elected to lay on us from September 1, 2014. And so I

ask: on whose side is this man and his team? To be sure, they have their

reasons for coming up with this. These reasons, they reckoned, are for the

greater benefit of us all. Isnt that why they are called public

servants? Of course it is! They are public servants because all that

bother them is how to advance our common interest. As such, the new charge

is another service to our interest whether we believe it or not.

In a bid to tamper whatever ill will the policy will generate, the bankers

bank, in the circular which contained the announcement asserted that the

new charge shall apply as from the 4th remote-on-us†withdrawal

(in a month) by card holder, thereby making the first three transactions

free for the card holder, but to be paid by the issuing bank.†Not yet

done it unequivocally stated that, all ATM cash withdrawals on the ATM

issuing banks shall be at no cost to the card holder, but to be paid by

the issuing bank.†This simply upheld the standard that had been in

place prior to December 2012.
Now, to why we must endure parting with our hard-earned N65 every fourth

time we withdraw cash from the ATM of another bank, CBN said the fee is to

cater for the remuneration of the switches, ATM monitoring and

fit-notes processing by acquiring banks.†Too much jargon in that

disclosure obfuscated communication from what CBN was saying. As a result,

the people screamed blue murder; necessitating another reaction from the

apex bank.
The CBN clarified through the Director in charge of its Banking Payments

Systems Departments, Dipo Fatokun that owing to lack of charges, it

observed that we have turned ATMs into our personal purses to the extent

that we go to withdraw sums as low as N500, or N1000 making us frequent

the ATM for up to four or ten times in a day. It noted that this our

attitude has created a huge cost burden for the banks that issue the cards

such that it is becoming discouraging to them.
This, the CBN noted, led them to resolve that we “can go to an ATM other

than your bank ATM to withdraw up to three times and no charges would be

imposed on you, but it is when you make the fourth withdrawal that you

will pay the N65 that ordinarily your bank would have paid on your behalf.

But of course, if you go to your banks ATM, the issuer, for withdrawal

you can withdraw as many times as you like without being charged.”

The apex bank ended by categorically stating that the new charge does not

discourage financial inclusion. But, I dare say that it does. Irrespective

of this education given by the CBN, a lot of people still mistakenly

believe that the N65 fee is taken each time they withdraw. To worsen the

case, others still think that they would also be charged when they even

withdraw from their bank's ATM. With this fears, an average Nigerian would

naturally opt to save his money else where that would be convenient for

him to access it than somewhere which detracts from the little s/he has.

The N65 may be such a chicken feed for most people, but I have been told

of a Nigerian who refused to subscribe to the SMS alert on transactions

because he is not comfortable with losing the N5 alert fee each time a

transaction is carried out on his bank account. The truth remains that

some Nigerians are that thrifty or poor! That should make us better

appreciate how much the N65 fee wouldn't discourage financial inclusion.

Obviously, the CBN wants a situation where people would withdraw money in

bulk instead of visiting ATM galleries for paltry sums. But then, the rich

men who withdraw large sums have no business utilising ATMs. May I ask,

when was the last time you saw Dangote joining the queue to withdraw cash

using the ATM? Truth is that rich men who are no where near him in the

scale of wealth order bank managers to dispatch whatever sum they need to

wherever they want it and the manager does that pronto. You don't see

these people in the banking hall let alone in front of ATMs.

I'm lost as to why the banks would complain about the N65 they are

offsetting for the remote-on-us transactions of their customers.

This is because they make much more than that from same customers. And

again the customers' overwhelming reliance on ATM for their transactions

have made banks cut down on their workforce. This has saved them the

excess amount they would have been spending on the remuneration of

At a time when mobile telecom companies operating in the country are

charging uniform rates for on-net and off-net voice calls, I see no reason

why the status quo in the use of ATM can't be maintained.

The Central Bank of Nigeria under the able leadership of Godwin Emefiele

need to know that its major responsibility is to protect Nigerians from

the exploitative tendencies of commercial banks. It becomes a disservice

when he allows them avenues to take advantage of us. It is when he and his

team who are paid by taxpayers protect the interest of Nigerians that they

would indeed fit into being addressed as public servants.

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