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Well-informed consumer population promotes resilient banking system – Alade

News » Health and Beauty

25th June 2014

A well-informed consumer population will promote a more resilient banking system. As consumers become more aware of their rights and responsibilities in the system, the tendency for banks to offer unethical and risky products is reduced. At the same time, consumers will be able to understand any product they want to acquire and be able to fully understand the risks associated with such product before acquisition. This will not only help in reducing financial crisis, it will also help sustain financial stability.

These were the words of Sarah Alade, deputy governor (Economic Policy), Central Bank of Nigeria (CBN), at 2014 summit of the Bank Customers’ Association of Nigeria (BCAN).

According to her, consumer awareness plays a key role in customer decision making. By increasing a potential or current customer’s knowledge about a product, service or business, a healthy economic environment evolves where customers are informed and protected and businesses are accountable for their actions.

“Therefore, the role of Bank Customers’ Association of Nigeria (BCAN) is very critical in deepening financial awareness in the country and in achieving greater penetration of financial education in the country. Consumer awareness benefits society by promoting customer satisfaction, increasing economic stability and creating realistic customer expectations of the banking industry.”

Taking the participants who gathered at the summit through the initiatives at the CBN to promote consumer education and consumer protection, she said the initiatives had ranged from rolling back some fees charged by the banks to establishing consumer protection department.

The CBN has also through its consumer protection department established a framework for regulation of banks, holding banks accountable, supervising and enforcing these regulations in banks and implementing broad-based consumer education programmes throughout the country.

Alade noted that the CBN through the consumer protection department had intervened between banks and their customers since May 2010. The bank received well over 3,000 complaints against financial institutions from consumers across the country, which led to the refund of various sums to affected customers. Pursuant to resolving these complaints no less than 5,000 mails, telephone calls, SMS and email correspondences had been made among the CBN, complainants and financial institutions, resulting in a total refund of N14.6 billion to customers at various banks in the country.

Other initiatives embarked upon by the bank include the introduction of ‘Guide to Bank Charges’ in 2012, which outlines permissible tariff rates to be applied by banks to address some of the ambiguities associated with the old guideline and impose additional disclosure requirements on banks.

She stressed that the success of the policies and interventions at the CBN will depend heavily on strong collaboration with stakeholders. “BCAN has a role to play in deepening consumer education and consumer awareness in the country. My hope is that this forum would serve as a platform for greater awareness of the transformative reforms that have taken place in the Nigeria’s financial sector in the area of consumer protection and that BCAN could key in on the initiatives to benefit its membership,” she said

Article Credit: Business Day News

Updated 5 Years ago

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