Customers lament domiciliary account arbitrary charges

By Oluwaseyi Bangudu October 13, 2010 12:06AM

Operators of domiciliary accounts are lamenting the charges on maintaining such accounts, saying that the arbitrariness of the charges makes them unjustifiable.Some bank officials, however, say though the charges are steep in some cases, running a domiciliary account is not essential unless it is absolutely necessary.


“Bank charges on domiciliary accounts cannot be fixed,” says a senior staff of Afribank.”The charges are dictated by the market. This thing is being regulated by the market. There is nothing you can do about it.


“Savings rates, currents account rates are regulated. If you give money to the bank to keep, you know what the banks would give; it can’t go below a certain rate or higher. But in terms of foreign denominated accounts, exchange rates also swing. It’s not stable, it’s always moving. So the rates cannot be static. If they say five percent, for instance, and the rates fall, there would be no basis to hold onto that rate. It’s a matter of supply and demand,” the Afribank official said.


“When you use credit cards, for instance, you know it is foreign currency denominated. When you are to be debited, we are going to look at the rates at that time. Take the Mallam who buys a dollar at N155 today, and a buyer says he wants to buy at N152 today, because that is what he bought a dollar the previous day, it won’t work. He has to look at the rates of that day,” he said.


A domiciliary account is an account in any foreign currency. It can be operated by customers upon fulfilment of all ‘know-your-customer’ requirements by the customer.


No benefit for the charges

But some bank customers argue also that banks are not offering services to justify their charges.“I personally don’t see any problem in an individual having such an account, because I have one myself,” said Olufemi Ade, a former staff of Bank PHB.


“The only issue is that the charges are not justified and in most cases, one doesn’t get good features with the products,” Mr. Ade added.Daniel Demilade, a customer of Guaranty Trust Bank, said charges on domiciliary accounts could be better regulated.


“Without prior notification, the bank withdrew about N8000 from my savings account with the bank, for charges related to my domiciliary account,” Mr. Demilade said.”They said it was for the deduction of a new Dollar master card for my domiciliary account. They said they sent prior messages, but I didn’t see any,” he said.


A source at Spring Bank said that the charges should be regulated, to avoid irregularities and the issue of banks taking advantage of their customers.”It is supposed to be a fixed amount. One bank is not supposed to be charging higher than others,” he said.


Customer care services of various banks that were visited said that there are no fixed service charges of domiciliary accounts.”It’s a system charged account, it has random charges, not fixed” a staff of Zenith Bank stated.


At Intercontinental Bank, $20 is usually charged on withdrawals or transactions on domiciliary account, which must have at least $15 dollars in balance.



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