COT: CBN gives banks ultimatum to refund extra charges
The Central Bank of Nigeria (CBN) has ordered all money deposit banks to immediately refund their customers extra N1 charge as Commission On Turnover (COT).
CBN in conjunction with the bankers’ committee had agreed in March 27, 2013 on a new standardized revised guide on implementation of COT and other charges.
The new guide provides that COT is negotiate subject to a maximum of N3 per mille in 2013, N2 per mille in 2014, N1 per mille in 2015 and no COT would be charged from 2016.
But the apex regulatory body, in a memo to the banks signed by its director, financial policy and regulation department, Frankline Ahonkhai, said information available to it indicates that some banks are still charging COT at the rate of N3 per mille, which was the agreed rate for 2014.
CBN said some banks have jettisoned the guide by charging unauthorized fees to the extent that some accounts that are supposedly COT free are forced to remit maintenance or similar fee, a fee not cover by the revised guide.
“All banks that have charged excess COT since the effective date of the guide are hereby required to refund same to the affected customers not later than 30 days from the date of the circular.”
CBN said: “For the avoidance of doubt, while Paragraph 4 of the preface to the guide states that the charges on products and services are not exhaustive, it however requires banks wishing to levy charges not covered by the guide to obtain the prior approval of the CBN.