Nigeria’s tier-1 banks — comprised of First Bank, UBA, GTBank, Access Bank, and Zenith Bank (FUGAZ) — generated a total of N18.4 billion from bank maintenance charges in Q1 2020. The sum is 17.12% more than N15.6 billion that was generated by the five banks during the comparable period in 2019.
This is according to recent checks by Nairametrics Research, a breakdown of which revealed that Zenith Bank generated the most income from account maintenance fees, followed by Access Bank and then, GTBank.
See the breakdown below.
- Zenith Bank Plc: N5.7 billion
- Access Bank Plc: N3.9 billion
- Guaranty Trust Bank Plc: N3.3 billion
- First Bank Plc: N3.1 billion
- United Bank for Africa Plc: N2.3 billion
What you should know about account maintenance charges
Banks’ earnings from account maintenance charges, though low when compared to other revenue streams, still make up a significant portion of their non-interest income.
According to the latest directive by the Central Bank of Nigeria on bank charges, Nigerian banks are allowed to charge their customers a “negotiable” N1 per mille. What this means is that banks can charge N1 per N1000 debit transactions on current accounts. Banks’ account maintenance charges come in the form of COT (i.e., Commission on Turnover) which is a charge levied on customer withdrawals by their banks. In Nigeria, these charges are mainly applicable to current accounts.
“Current Account Maintenance Fee (CAMF): Applicable to current accounts ONLY in respect of customer-induced debit transactions to third parties and debit transfers/lodgments to the customer’s account in another bank. Note that CAMF is not applicable to Savings Accounts,” said part of the CBN directive.