Beginning from this month, Nigerians who save their hard earned monies in the banks will pay extra charges for every deposit or withdrawal of N500,000 and above.
The Central Bank of Nigeria made this known in a circular to all Deposit Money Banks (DMBs) on Tuesday, in which it also said the nationwide implementation of the cashless policy will begin by March 31, 2020.
This cashless policy implementation would signal the imposition of charges on deposits and withdrawals in addition to already existing charges on withdrawals.
According to the circular, the charges will take effect from Wednesday, September 18, 2019, in Lagos, Ogun, Kano, Abia, Anambra, Rivers States and the FCT.
The circular showed that transactions would attract three percent processing fees for withdrawals and two percent processing fees for deposits of amounts above N500,000 for individual accounts.
For corporate accounts, the apex bank in the circular said that DMBs would charge five percent processing fees for withdrawals and three processing fee for lodgments of amounts above N3,000,000.
It would be recalled that the federal government recently approved the increase in Value Added Tax (VAT) rate to 7.5% from its previous 5%. The minister of finance, budget and national planning, Zainab Ahmed, made after the Federal Executive Meeting (FEC) meeting on Wednesday, September 11.
IMPLICATION OF THE POLICY
Meanwhile, a Bank manager who threw light on the new bank charges described it as wrong and extremely exploitative.
His words; “The implication is that if someone deposits N1m cash into Mr. A’s bank account, the bank will immediately earn N20k (2%) from that deposit. Then if Mr. A withdraws the N1m deposited, he gets hit with a N30k (3%) charge.
“This means the bank has earned a 5% agency fee on money they contributed nothing to its being earned by Mr. A. That is N50k to the bank just because someone earned N1m from a transaction. They will still charge stamp duty of N50 for that deposit. They will still charge COT of 0.1%. This means that Mr. A will pay N1k.
“So, on a N1m deposit and withdrawal, the bank will earn N51, 050. When you throw in the increment of VAT from 5% to 7.5% you don’t need a crystal ball to tell you that this CBN policy is wrong and extremely exploitative and will negatively impact on a lot of people.
“In fact, it will cause serious capital flight from banks and very soon many banks may begin to experience liquidity problems.”