E-banking Expenses Gulp N80.75bn From Five Tier-1 Banks’ Earnings.
The increasing embrace of e-banking transactions aided by the lockdown measures at the height of the first wave of the Covid infection has taken out N80.75 billion in form of fees and commission expenses from the earnings of five banks in nine months of 2020, the computations by InsideBusinessNG has shown.
The amount represents 29.8 per cent increase over N62.19 billion fees and commission expenses recorded by these banks in the prior nine months.
On the flip side, the banks also made N127.3 billion income as more turned to electronic banking option in measure to escape Covid-19 infections in the same period under review.
Fees and commission expenses are charged for the provision of services to customers transacting on alternative channels platforms of the bank and on the various debit and credit cards issued for the purpose of these payments.
They are charged to the bank on services rendered on interest banking, mobile banking and online purchasing platforms.
Fees and commissions expenses include the cost incurred to the bank for providing alternative platforms for the purposes of internet banking, mobile banking and online purpose.
InsideBuinessNG’s investigation shows that United Bank for Africa Plc (UBA) has the highest fees and commission in the sector as the pan-African bank operates in 20 African countries, Europe and USA.
The bank reported N28.77billion fees and commission expenses in nine months of 2020, a 24 per cent increase over N23.2billion reported in nine months of 2020.
Key drivers in UBA’s fees and commission expenses include N23.34billion E-banking expenses as against N19.92billion reported in nine months of 2019, while Trade related expenses moved from N982million in nine months of 2019 to N2.15billion in nine months of 2020.
In addition, funds transfer expense closed nine months of 2020 was N2.38billion as against N2.33billion reported in nine months of 2019.
“Our Direct Sales Agents, Agency Banking Network, and Digital Banking propositions have positioned us at the forefront of financial inclusion across geographies where we operate”, noted the Group Managing Director, UBA Plc, Kennedy Uzoka.
The Bank during this period, provided support to customers across its footprint, assisting them to navigate the negative impact that Covid-19 pandemic has had on livelihoods, businesses and social life.
The Chief Executive Officer, Enterprise Stockbrokers Plc, Rotimi Fakayejo attributed the hike in fees and commission expenses on banks to COVID-19 lockdown, stressing that banks customers had online transactions as the only option during the period.
He expressed that increased customers in each bank also contributed to aggressively increase in fees and commission in the period under review.
Zenith Bank Plc in the period under review reported N16.67billion fees and commission expenses, representing 33 per cent increase over N12.57billion reported in prior nine months, while Access bank plc in nine months of 2020 reported N16.04billion fees and commission expenses, 47.4 per cent increase over N10.89billion reported in nine months of 2019.
FBN Holdings reported 7.3 per cent fees and commission as the expenses jumped to N14.6billion in nine months of 2020, while GTBank’s fees and commission expenses grew by 148.45 per cent to N4.67billion in nine months of 2020 compared to N1.88billion reported in nine months of 2019.
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