CBN issues banks new guidelines, fines over customers’ complaint 

The Central Bank of Nigeria (CBN) has issued a warning to banks regarding customer complaints. The CBN, in a recent guideline, said banks would be fined N2 million if they failed to acknowledge complaints from depositors.

The apex bank in a circular to all banks, other financial and non-bank financial institutions, said the objective of the guideline was to ensure fair treatment of customers, disclosure and transparency, responsible business conduct, as well as complaints handling and redress in accordance to the stipulated timeframe.

CBN gave this warning in its Consumer Protection Regulations, another guideline drafted to improve upon the Consumer Protection Framework which was issued on November 7, 2016. It is expected to boost customer confidence in the financial services industry and promote financial stability, growth and innovation.

Cost for violating guidelines: Any bank found guilty of not operating in accordance with the guidelines of this regulation will be sanctioned.

• Non-resolution of complaints within prescribed timelines – a penalty of N500,000.00 per complaint per week while the infraction subsists.
• Non-acknowledgment of complaints from customer or non-issuance of tracking numbers – N2,000,000.00 per complaint.
• Non-response to request or failure to comply with CBN directive – A penalty of N2,000,000.00.
• False or non-rendition of Returns/Reports – N100,000.00, and in addition, N10,000 for each day the infraction continues.
• Persistent breach of regulations – Administrative sanctions on responsible officer(s), including issuance of warning letters and any other statutory sanctions on the officer(s) or Institution. These may be in addition to the sanctions prescribed in this Section of the Regulation.
• Failure to comply with other provisions of the Regulations not specified above shall attract sanctions provided in the CBN Act, the BOFIA, other enabling laws and regulations.

[READ MORE: CBN slashes ATM withdrawal fee, others, imposes N2 million fine on Banks)

Why this matters? According to the CBN circular seen by Nairametrics, the Customer Protection Regulation will protect customers from/against

• unfair and exploitative practices by Institutions in their dealings with the consumers;
• unethical and predatory practices that undermine consumer confidence in the use of financial products and services;
• the provision of inadequate and misleading information and/or failure to disclose material information;
• The regulation will ensure access to complaint redress mechanisms that are free, fair, timely, transparent, accessible and independent; and
• It will encourage transparency of Institutions in their dealings with consumers.

Ways to channel complaints: Apart from the traditional walk-in procedure, banks are expected to have several channels of communication available for their customers complaints. Some of the channels are: letters, e-mails, telephone lines, social media and digital software platforms. Within 24 hours of the complaint, banks are required to acknowledge and contact the customer. Click the link to know more.