Banking
Emefiele, Bank MDs to Face Senate Over Illegal Charges
By Modupe Gbadeyanka
Governor of Central Bank of Nigeria (CBN), Mr Godwin Emefiele, has been asked to appear before the Senate to explain reason for excess and arbitrary bank charges and illegal deductions allegedly by commercial banks operating in the country.
The Senate Committee on Banking, Insurance and other Financial Institutions also asked the Managing Directors of the lenders to appear before it.
This followed a motion moved at the plenary on Tuesday by Senator Magnus Abe titled ‘Urgent need to investigate, regularize and amend conflicting, vague and unjust remedies which the Central Bank of Nigeria offers to victims of Excess and Arbitrary Bank Charges and Illegal Deductions by Commercial Banks.’
The lawmaker said the upper parliament needs to urgently investigate, regularize and amend conflicting, vague and unjust remedies which the CBN offers to victims of excess and arbitrary bank charges and illegal deductions by commercial banks.
He warned that, “If this trend is allowed to continue unabated, Nigerians will be worse for it, while the commercial banks will continue to declare huge profits at the expense of innocent Nigerians from regular depositors to business firms.”
According to him, the CBN on the 20th February reported that it had recovered about N2.6 billion from banks as excess charges imposed on their customers in 2015 through a statement issued by the Director, Corporate Communications Department, Mr Muazu Ibrahim.
Mr Abe noted that in 2015 alone, the apex bank investigated about 6,000 of such cases.
He expressed concern that several of the Central Bank of Nigeria applicable rules that should remedy such hardship and discourage sharp practices by the commercial banks are conflicting, vague and unjust. There by causing the commercial banks to frequently short change their customers;
The Senator added that requests made by Bank Customers to the Central Bank of Nigeria for clarification of the rules are largely ignored.
In his contribution, Senator Dino Melaye raised the issues of no consent of deduction from banks on its customers as this has led to maximum profits over time by banks across the country and also called the attention of the Senate to direct the banks to contact the next of kin of dead customers as this has been a norm by banking sectors not declaring or contacting the next of kin rather than been secretive about the funds in the account.
“Banks need to be honest to its customers and there is need for the Senate to find out who in authority conferred such power to banks to make such deductions from customers without their consent, and what the money is being used for,” Senator Isah Misau said.
At the end of deliberations, the Senate resolved to urge the government to proactively protect customers rights, eradicate short payments of interest and end the culture of excess and arbitrary bank charges, these steps if taken will reposition the bank to avert future re-occurrence.
It also directed its committee on banking to conduct a public hearing and invite the CBN Governor, his officials and other stakeholders such as forensic auditors, MDs of commercial banks and bankers committee with a view to harmonizing and amending these laws, rules and guidelines that do not adequately protect the customers and give them substantial remedy when overcharged.
“I commend this very important motion particularly at this difficult time when every Naira is important.
“We must be seen to defend the interest of Nigerians who don’t have the voice to defend themselves. Again, the issue here is to get to the bottom of what the laws and guidelines are, and we should show that they are in line with laws and we have the powers to make such pronouncements,” the Senate President, Mr Bukola Saraki, said.
By Modupe Gbadeyanka
The Nigeria Revenue Service (NRS) has denied reports that customers performing financial transactions would pay a Value Added Tax (VAT) of 7.5 per cent from January 19, 2026.
Information about this emanated from messages sent out to customers of a financial institution, informing them of the new development in compliance of Nigeria’s new tax laws, especially the Nigeria Tax Act 2025.
It was claimed that Nigerians, as part of efforts of the government to generate more funds from taxes, would begin to pay VAT for the use of banking services like USSD and others.
But reacting in a statement signed by its management on Thursday, January 15, 2026, the tax collecting agency emphasised that the VAT collection for such services was not new.
It stressed that customers have always paid taxes for electronic money transfers and others, as this is charged on the fee, not from the main amount of the transaction.
“The Nigeria Revenue Service wishes to address and correct misleading narratives circulating in sections of the media suggesting that Value Added Tax (VAT has been newly introduced on banking services, fees, commissions, or electronic money transfers. This claim is categorically incorrect.
“VAT has always applied to fees, commissions, and charges for services rendered by banks and other financial institutions under Nigeria’s long-established VAT regime. The Nigeria Tax Act did not introduce VAT on banking charges, nor (sic) did it impose new tax obligation on customers in this regard.
“The Nigeria Revenue Service urges members of the public and all stakeholders to disregard misinformation and to rely exclusively on official communications for accurate, authoritative, and up-to-date tax information,” the statement read.
Business Post reports that what this basically means is that if a customer sends N10,000 and the bank charges N50 for the service, a 7.5 per cent VAT on the N50, which is N3.75, would be paid by the sender, not N750, which is 7.5 per cent of N10,000.
By Adedapo Adesanya
Nigerian-born payments company, Paystack, has announced its entry into the banking sector with the launch of Paystack Microfinance Bank (Paystack MFB) after the acquisition of Ladder Microfinance Bank.
The bank continues Paystack’s push into consumer products and adds a banking layer to its business-focused payment product, coming ten years after the company was founded with the goal of simplifying payments for businesses using modern technology.
In Nigeria alone, the company says its systems process trillions of Naira every month, supporting more than 300,000 businesses and millions of customers. According to Paystack, this growth highlighted a broader need beyond payments, prompting the decision to build a more comprehensive financial offering.
Paystack MFB will begin lending to businesses before expanding to consumers. It will also offer banking-as-a-service (BaaS) products to companies building financial products and treasury management products.
The company explained that while payments are a critical part of the financial journey, businesses and individuals increasingly require a full financial operating system. This includes the ability to store money securely, move funds easily, gain clarity from financial data, and access tools that support long-term growth. Developers, Paystack added, also need reliable, secure, and compliant infrastructure to build new financial solutions efficiently.
To address these needs, Paystack said it has established Paystack Microfinance Bank as a separate and independent entity from Paystack Payments Limited.
The new microfinance bank operates with its own license, governance structure, and product roadmap, although it will work closely with its sister company.
“By adding Paystack MFB to our family of brands, we’re finding the right balance through combining the rapid innovation of a tech-first platform with the stability of traditional banking,” said Ms Amandine Lobelle, Paystack’s chief operating officer.
Last year, it launched its controversial consumer payments app Zap, and now it is taking a step further with the company securing regulatory backing to become a deposit-taking institution. According to a statement, the bank will be guided by the same principles that shaped Paystack’s early success, including reliability, simplicity, transparency, and trust.
Paystack MFB has begun operations with a small group of early members and plans a gradual rollout to more businesses and individuals. The company also announced the opening of a waitlist for interested users and confirmed it is recruiting a dedicated team to help build its long-term banking infrastructure.
By Modupe Gbadeyanka
The Economic and Financial Crimes Commission (EFCC) has helped First Bank of Nigeria to recover the sum of N802.4 million from a suspect, Mr Kingsley Eghosa Ojo, who unlawfully took possession of over N1.3 billion belonging to the bank.
The funds were handed over the financial institution by the Benin Zonal Directorate of the anti-money laundering agency on Monday, January 12, 2026, a statement on Tuesday confirmed.
First Bank approached the EFCC for the recovery of the money through a petition, claiming that the suspect received the money into his account after system glitches.
The commission in its investigation; discovered that the suspect, upon the receipt of the money, transferred a good measure of it to the bank accounts of his mother, Mrs Itohan Ojo and that of his sister, Ms Edith Okoro Osaretin, and committed part of the money to completion of his building project and the funding of a new flamboyant lifestyle.
With the recovery of the money from the identified bank accounts, the EFCC handed it over in drafts to First Bank.
While handing over the lender, the acting Director for the Directorate, Mr Sa’ad Hanafi Sa’ad, stressed his organisation would continue to discharge its mandate effectively in the overall interests of society.
“The EFCC Establishment Act empowers us to trace and recover proceeds of crime and restitute the victim. In this case, First Bank was the victim and that is exactly what we have done.
“We will continue to discharge our duties to ensure that fraudsters do not benefit from fraud and that economic and financial crimes are nipped in the bud,” he said.
In his response, the Business Manager for First Bank in Benin City, Mr Olalere Sunday Ajayi, who received the drafts on behalf of the bank, commended the EFCC for the swiftness and the professionalism it brought to bear in the handling of the matter and expressed the bank’s gratitude to the commission.
He described the EFCC as one of Nigeria’s most effective and reliable institutions.
Meanwhile, Mr Kingsley and all other suspects in the matter have been charged to court for stealing by the EFCC.
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