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Breaking: Nigerian Banks to pay N10k fine for every failed electronic funds transfer

Breaking: Nigerian Banks to pay N10k fine for every failed electronic funds transfer

- Banks have been ordered to pay a N10,000 fine for failed electronic transactions across Nigeria

- The fines are to be paid if the said Nigerian Instant Payment transaction are not reversed into the customer’s account within 24 hours

The Central Bank of Nigeria (CBN) has ordered Nigerian banks to pay a fine of N10,000 for every failed Nigerian Instant Payment transaction not reversed into the customer’s account within 24 hours.

The order by the apex bank was contained in a circular on the regulation on instant inter-bank electronic funds transfer services in Nigeria, issued to all deposit money banks, microfinance banks, other financial institutions, mobile money operators, development finance institutions, payment service providers and other stakeholders.

The CBN said that delayed application of inward NIP into beneficiary's account beyond four minutes would attract a penalty fee of N10,00 per item.

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The circular said: “The sanctions above and any other prescribed in the Nigeria Bankers’ Clearing System rules or any amendment thereto, shall apply.”

According to CBN an NIP happens between two distinct entities when delivery from the sending entity to the receiving entity takes place within one minute (60 seconds).

It also added that a payment system where delivery to the receiving entity occurs beyond one minute is considered to be an ACH system.

However, it said that an EFT service provider is said to be a company or financial institution licensed by the CBN to do the business of facilitating EFT services in partnership with sending and receiving entities.

Punch reports that an automatic indemnity would be inferred against the sending entity making the reversal request where the sending entity erroneously sent value contrary to the customer’s instructions due to wrong account number, wrong amount, duplication among others to a receiving entity and requested the reversal in writing within 14 working days of the transaction.

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It said the receiving entity should oblige within one business day without recourse to the customer (beneficiary) of the receiving entity provided funds were available. An automatic indemnity would be raised against the sending entity making the reversal request, it stated.

However, should the funds be unavailable, the receiving entity should immediately notify its customer that the account was wrongly credited and provide proof of such notification to the sending entity.

The apex bank said the receiving entity should notify the customer about the consequences of not funding the account within 24 hours, which included watch-listing in the banking industry, credit bureau and reporting to law enforcement agencies.

It also added that the receiving entity would watch-list the customer if he failed to provide funds within seven days.

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Meanwhile, Legit.ng previously reported that the apex bank had mandated deposit money banks (DMBs) to refund N6.2 billion to customers they over charged as cost of transactions in 2015.

The directive by the apex bank was contained in a statement made available by the director, corporate communications, of the CBN Ibrahim Mu’azu.

CBN said banks were allowed to make charges for banking services but kicked against the fleecing of banking customers under any guise.

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Source: Legit.ng

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