How public-serving is the reintroduction of the N65 ATM fee?
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 weren't vociferous enough in repudiating the policy, the central bank wouldn't 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, don't 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 banks.
It is this N65, which was hitherto borne by commercial banks, that Emefiele's 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. Isn't 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 bank's 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 staffers.
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.