Banks Need ABC
By Tunji Oseni
In the current controversy over a N25 billion capital base, the needs of non-billionaires and non-millionaires are given scant attention, that is when at all. The banking industry seems content with what they have always been doing: looking up the skies while the interests of majority of Nigerians are conveniently ignored and easily forgotten. And yet, the super-rich, the rich and even the middle-class constitute Nigeria's numerical minority.
My interest today is to argue for the need for an Association of Bank Customers (ABC). Such an association will be one means of stopping, or minimising, the blatant rape by the banks on their ordinary customers. None of the banks is immune from such a dastardly practice, as I will go to demonstrate and challenge any of them to contradict me. It is no small matter because the end-product of the rape is that Nigerian banks scarcely remember that they have a role in poverty reduction, not to talk of elimination.
The banks are an inevitable part of any modern economy. They have grown so big today that they could conveniently ignore regulatory authorities including the Central Bank of Nigeria (CBN). Their own inspectorate arms do what the banks want done, not what the customers deserve. What they call the Bankers' Committee is an association of the banks to get the best deals for themselves. To them, customers don't begin to count, unless they are the big players.
We have come to a stage where even bankers themselves, or a little percentage of them who are true professionals, will admit that banking is too important to be left to bankers alone. Let me illustrate the rape on the little customers by making reference to what the banks now regard as standard practice: It used to be the case that on a regular basis, your bank would let you know what your account held. You got such information through the post: what money you deposited, how much was withdrawn, how much was left.
These days, the banks figure that such a service is unnecessary. Most of them, when they issue such statements, dump them in their own closets. Invariably, when you ask, somebody is assigned to fish it out for you, but he never gets it. If you are "influential" enough to get a printout, nobody is willing to explain what you may wish to know. And they tell you how much time you have to complain, "or forever, keep quiet", and accept their figures as gospel truth.
The issue here is not about technology making certain actions unnecessary because the customer can always access his accounts and get required information. It is that the type of customer I am writing about may not have such facilities, or be able to use one. Yet, as a bonafide customer, there is no reason why he should not get information on his own account. Those customers who wish to get legitimate information should be able to do so. And the banks owe them an obligation to provide such information.
I have spoken to many people who have narrated their experiences with banks in regard to 'dormant accounts'. The banks' argument goes something like this: If a customer, even with money in his account, has not operated such an account for some time, the bank decides to put the account in the 'dormant' category so nobody (the bank staff) can interefere with it. When the account owner eventually re-surfaces, he is then told that he has to pay an amount (N5,000) in order to resuscitate it. I have always refused because it does not make any sense to me that while my account is in the black, and with the bank, I should be punished for leaving my money in the bank even for a period when I don't operate it. The bank, for one thing, is making use of the money, and should not be asking me to pay for resuscitation. I don't mind being asked to write a note, but what should I be paying for In banks outside Nigeria, the day you walk in, your interest is added, your account is updated, and you are not punished for either being involuntarily put in the dormant cooler, or wishing to be taken out of where you were sentenced into.
It is impossible to know how much small customers have lost to banks which have refused to pay the deserving interests or banks which consider such non-payment as part of the operating profit they fraudulently declare. Even where CBN determines that such interest should be paid on both current and savings accounts, the banks not only shortchanged the customer by paying less; in many cases they don't pay at all. Where they do, they vary in the interest they pay because each bank is a lord onto itself. It is said that the Bankers' Committee is the voice that the banks recognise and invariably, the Committee decides to pay the customer less than CBN says. Each bank even becomes its own authority, and the customer loses!
The following happens all the time. You put money in an account and for about six months, you don't issue a cheque or put in a deposit. What you notice later is that your account is always getting leaner. The bank regularly deducts money from the account for COT, VAT, etc. Meanwhile, nothing is added by way of interest to your account. Since it is only deductions by banks that feature, your account gets leaner and leaner, even as you have not issue any cheque.
Bank staff always want to convince you that positive practices you observe outside the country cannot be expected to be enjoyed here. They say the level of their service will take us years to attain. What they don't tell you is that the profits our banks declare and the obscenity in which many bank staff operate takes no note of the unjustified punishment to which ordinary customers are routinely subjected. Unless the customers come together to fight their cause, they will continue to be fleeced.
Part of the reason there are so many unclaimed dividends is traceable to the non-operation of the banks. The little customer who manages to buy a few shares and who is sent a small amount, may have nothing other than a savings account. He approaches his bank with the dividend warrant and the bank refuses to willingly pay the dividend into his savings account, directing the customer to pay into a current account which the customer may not have. In frustration, the customer dumps the dividend "somewhere" and it get lost forever. Even in the case of banks which reluctantly agree to pay into "favoured customers" account, there is said to be limit to how much can be accepted into a savings account. What the banks will not tell you is that they prefer that the customer pays into a current account on which they will pay no interest rather than the savings account which may attract a pittance.
I was almost a victim of this practice some years ago. I had paid a state government a levy through a bank draft. The government later demanded evidence of my payment. I approached my bank for a statement of amount, date, cheque number. The bank manager said I had to pay for the search to be conducted, even as my counterfoil showed the date and the amount paid to the government. It took my appeal to the headquarters for the branch manager to be overruled and the statement issued. It is appropriate to consider a number of issues relevant to the relationship between banks and their customers.
Most banks leave a customer with the distinct impression that they were created to cater to the interests of the rich. It is they who own and run businesses, who make the most money, who are visible enough and to whom bank staff will kow-tow. At the same time, banks cannot be bothered that at the end of the day, their policies are practices end up impoverishing even more the already poor who are too preoccupied with the demands of eking out a living that they can barely raise a finger not to talk of a whole hand.
I have not come across any programme of any Nigerian bank designed to fight to reduce not to talk of eradicate poverty. And yet, the banks themselves know that about three- quarters of Nigerians are rated poor. Shouldn't an institution occupying such a strategic position in the Nigerian economy have a well thought -out programme to fight poverty Should our banks be satisfied with just making the rich richer I am aware that there are a few banks which make provision for their staff and which attend to the needs of the masses in their own way. But such banks are few; and given the level of their successes, they should do more to alleviate poverty.
The banks may wish to consider a few suggestions:
* During the holidays, individual banks can sponsor programmes
for young primary/secondary school students to take them out of harm's way. When the young grow, they will remember such banks with gratitude for a king time, and may even become customers.
* Banks can expand their interest to even the tertiary institutions.
The money spent on such programmes will get back to the banks as students graduate and enter the economy.
* At the local government level, there is nothing wrong with
Nigerian banks making their presence felt on market days, not by carrying out banking functions, but in interesting ways such as cheap give-aways and advise on financial management.
* In regard to our small-time farmers and rural folk, the
assistance which banks can render without any dent on their mountains of cash can be considerable. What is required is commitment and co-ordination. One doesn't expect the banks to be "Father Christmas", but an imaginative and realistic programme not latched on to collateral and never ending debt commitment can go some way. If banks put their confidence in ACAMB (Association of Corporate Affairs Managers of Banks), a lot can be done. The place to start is where banks make a commitment to an alleviation of poverty and seriously pursue such programmes.
The banks must look into the unwholesome practices going on on their shop floors. If they claim not to know, then they are derelict and should wake up. The banks must be determined to give "little customers" their due. At present, the impression created is that many a branch manager gets on the good books of headquarters through denying small customers their dues. Both the Central Bank and the banks themselves must look at their inspectorate and regulatory mechanisms again and see whether they are working. They will see, if they look seriously enough, that the "little customer" is a major victim of the lack of enforcement even of the regulations which are in place.
Having watched the dance of the banks for quite some time, I do not believe all of them are already occupied with catering to the rich and to themselves to be much bothered by the voice from "the cellar". That is why there is a genuine need for an Association of Bank Customers (ABC) which can articulate the grievances of "little customers" and redress the wrongs of so many years. Unfortunately, the best that can be achieved will be to the benefit of current and future customers. Many have been unjustly shortchanged for years. A permanent watch over bank customers' interest has become a necessity.
* Tunji Oseni is former Press Secretary to President Obasanjo.
