As part of efforts to pacify bank customers, the Central Bank of Nigeria (CBN) has reviewed the minimum interest payable on savings deposits as provided in its Guide to Charges by Banks, Other Financial and Non-bank Financial Institutions issued in December 2019.
With this, effective today, interest on local currency savings deposits shall be negotiable subject to a minimum of 10 per cent per annum of Monetary Policy Rate (MPR), as against the 30 per cent it was previously.
The CBN stated this in a letter to all banks dated August 31, 2020, signed by its Director of Banking Supervision, Bello Hassan, a copy of which was obtained yesterday.
The central bank stated that it took the decision because it had noted, “with satisfaction the recent declining trend in market rates in the banking sector following the implementation of policies aimed amongst others, at stimulating credit flow to the real sector.”
It added in the three-paragraph letter: “In line with recent market developments, the Bank has reviewed the minimum interest payable on savings deposits as provided in its Guide to Charges by Banks, Other Financial and Non-bank Financial Institutions issued in December 2019.
“Consequently, all deposit money banks are hereby informed that effective September 1, 2020, interest on local currency savings deposits shall be negotiable subject to a minimum of 10 per cent per annum of Monetary Policy Rate.”
The apex bank had last December, announced the downward review of charges for electronic banking transactions; review of other bank charges to align with market development and the inclusion of new sections on accountability/responsibility and a sanction regime to directly address instances of excess, unapproved or arbitrary charges.
Some of the major highlights of the Guide to Bank Charges introduced then, included the removal of Card Maintenance Fee (CAMF) on all cards linked to current accounts, a maximum of N1 per mille for customer induced debit transactions to third parties and transfers or lodgments to the customers’ account in other bank on current accounts only; reduction in the amount payable for cash withdrawals from other banks’ Automated Teller Machines (Remote-on-us), as well as from N65 to N35, after the third withdrawal within one month. Other reductions included then were Advance Payment Guarantee (APG) which is now pegged at maximum of one per cent of the APG value in the first year and 0.5 per cent for subsequent years on contingent liabilities.