The call for zero transaction charges by commercial banks in Nigeria has grown louder, following Sterling Bank’s recent announcement to eliminate fees on mobile and online transfers.
This move, unveiled on April 1, has reignited discussions about financial inclusion and customer-centric banking practices while raising questions about the sustainability of such measures in a revenue-driven industry.
Sterling Bank’s policy eliminates charges for online transfers conducted through its mobile app, as well as fees for ATM card issuance.
Despite initial skepticism due to the announcement coinciding with April Fools’ Day, many customers have since confirmed that they were not debited for mobile transfer charges. The policy has been described by stakeholders as a potentially game-changing development in Nigeria’s financial ecosystem.
Nigerian banks currently levy a variety of charges for transactions, which include N10 for transfers below N5,000, N25 for transfers between N5,001 and N50,000, and N50 for transfers above N50,000. There is also an additional 7.5% VAT on transaction fees.
These fees have generated significant revenue for banks. For example, in 2024, Zenith Bank earned N80.05 billion from electronic transaction charges, a 54.51% increase compared to the N51.8 billion recorded in 2023.
Similarly, United Bank for Africa (UBA) generated N284.7 billion from electronic business transactions in 2024, representing an 85.9% growth in its e-transaction revenue when compared with the N157.1 billion recorded by the bank in 2023.
GTCO Plc also recorded N56 billion in electronic-related fees, alongside substantial earnings from account maintenance charges and forex commissions.
While these revenues are crucial to banks’ operations, they often impose a heavy financial burden on customers, many of whom frown upon the charges.
Sterling Bank’s zero-charge policy has sparked a renewed push for more customer-friendly banking practices.
