By Juliet Umeh

“I recently came to the painful realisation of how much I am losing to bank charges after reviewing my transactions linked to a contribution scheme I manage”, Mrs. Elizabeth Akpan told Saturday Vanguard.

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“It has been horrible. You don’t even know what you are being charged for,” she said, her tone heavy with frustration.

What began as a routine review, she explained, soon turned unsettling as she started noticing repeated deductions across her accounts.

“I opened my one bank’s app and saw different kinds of charges – SMS charges and all sorts of deductions. I checked another account with another bank  and it was almost the same thing. They charge for this and charge for that,” she said.

For her, what is most worrying is not just the size of the deductions but how frequently they occur.

“If I show you my account statement, you will see N50, N100, N250 and N300 popping up. Before you know it, the money is gone. Most people don’t even know exactly what they are paying for,” she said.

Frustration

Beyond personal frustration, Akpan said the experience has made her question the transparency of the system, warning that it is gradually eroding confidence in formal banking.

“They are talking about financial inclusion, but these charges are frustrating people. Sometimes it feels like keeping money under your pillow is better, except for the risk of theft,” she added softly.

Across Nigeria, citizens are increasingly being encouraged to adopt digital payments as the government, banks and fintech companies expand investments in the country’s Digital Public Infrastructure, DPI, the foundational systems that support digital identity, payments and data exchange.

Yet for many users, trust in that infrastructure is being tested by charges they often struggle to understand.

While Nigeria has invested heavily in digital payment infrastructure through initiatives led by the Central Bank of Nigeria, CBN, the Nigerian Inter-Bank Settlement System, NIBSS, banks and fintech operators, many users say their lived experience is defined more by deductions they struggle to understand than by convenience.

Digital payments surge, but confusion grows

The debate over bank charges is unfolding at a time Nigeria is recording unprecedented growth in electronic payments.

Data from NIBSS shows that the value of instant payment transactions surged to N1.07 quadrillion in 2024, representing a 78 percent increase from N600.36 trillion recorded in 2023. The highest monthly value was recorded in December 2024 at N115 trillion, reflecting the growing dependence of Nigerians on digital transactions.

Similarly, Nigerians carried out 1.38 billion Point-of-Sale, POS, transactions worth N18.32 trillion in 2024, while mobile money operators processed transactions valued at N79.5 trillion, according to NIBSS data.

Figures published by the CBN also show that internet-based transfers accounted for 51.91 percent of all electronic payment transactions by volume as of June 2024, while POS transactions represented 28.53 percent and mobile payments 15.58 percent.

This growth aligns with Nigeria’s financial inclusion agenda. The 2023 Access to Finance Survey by EFInA found that financial inclusion in Nigeria rose to 74 percent in 2023, up from 68 percent in 2020, reducing the financially excluded population to 26 percent.

Yet, experts warn that growth in transaction volumes does not automatically translate into trust.

The problem is opacity, not overcharging – Tech experts

Speaking at Open Access Data Centre, a technology expert, Obinna Adumike, said Nigerians are not necessarily being overcharged in strict terms, but are instead facing a deeper problem of poor understanding and transparency.

“I wouldn’t necessarily say Nigerians are being overcharged in a strict sense because most customers do not even clearly understand the full list of deductions being made from their accounts,” he said.

According to him, many Nigerians only become aware of charges when they review statements or transaction histories, where multiple deductions appear without context.

“In many cases, you only become aware of these charges when you print your statement and suddenly see deductions for transfers, maintenance, VAT and other items that often appear confusing to the average user,” he explained.

“Technically, these charges are published and available, but the problem is not availability; it is accessibility and comprehension. There is a wide gap in financial literacy and digital understanding,” he said.

Adumike argued that the system itself needs simplification.

“From a technology standpoint, the system needs to be far more streamlined. We should have a consolidated structure, one clear line for bank charges, another for government taxes. Everything else should be simplified into a predictable framework.”

He said technology should play a stronger role in improving transparency at the point of transaction.

“Banking apps should not just execute transactions; they should disclose costs upfront. Before confirmation, users should see a breakdown of amount, VAT, transfer fees and total cost. Most modern payment systems already do this,” he noted.

He cited fintech platforms as examples of better transparency.

“For example, platforms like Jumia checkout systems or payment processors like Paystack show full cost breakdowns before payment is completed. Traditional banking apps still need to improve in this area.”

Adumike also called for stronger public education.

“CBN has made efforts to publish guidelines, but putting information on a website is not enough. There needs to be stronger digital education, possibly in partnership with agencies like the National Orientation Agency,” he said.

On whether Nigerians are overcharged, he said perception is shaped more by opacity than excess, adding ”the issue is not necessarily excessive charging; it is lack of clarity. That is what creates distrust.”

He warned that confusion around charges could affect financial inclusion because ”when people feel unsure about deductions, some begin to lose confidence in the system. In extreme cases, they may prefer informal cash storage. But that decision is influenced by multiple factors, not charges alone.”

Ultimately, he said trust remains the central issue.

POS operators feel the pressure

The concerns extend beyond bank customers to POS operators, who sit at the frontline of Nigeria’s cashless push.

Mrs. Anna Bush, a small business owner, said recent transaction charges have triggered fresh complaints from customers.

“A lot of people complain about deductions from their accounts and debit alerts for one thing or another,” she said.

“Now there is another charge on POS transactions. We were told it is from the Central Bank of Nigeria and that transactions from N10,000 and above will attract charges. It was not like this before.”

According to her, customers increasingly feel they are paying charges at multiple points in a single transaction.

“If I transfer money from my bank account to a POS account above N10,000, a charge will be deducted. Customers complain that they are paying for POS transfers, and banks are also charging them. It feels like people are being charged at every stage.”

Another POS operator, Mrs. Manuwa Samuel, said she has come to accept the deductions, even if she does not fully understand them.

“The bank charges are not normal; we are just managing it,” she said.

She noted that what used to be minimal deductions have gradually increased.

“If you want to do a transfer of N5,000, they charge N50. Before, it used to be N20, but now, because of tax and all that, they are charging more than N20.”

While individual deductions appear small, she said the cumulative effect is significant for low- and middle-income earners who carry out frequent transactions.

A system built on charges

Nigeria’s banking sector has increasingly leaned on fee-based income.

Recent financial disclosures show that 11 listed banks generated N209.18 billion from account maintenance charges in the first quarter of 2026, up from N183.37 billion in the same period of 2025. Across the same period, banks also earned N984.47 billion from fees and commissions.

Although account maintenance charges officially apply mainly to current accounts under the CBN’s Guide to Charges by Banks and Other Financial Institutions, customers often encounter multiple deductions- SMS alerts, transfer fees, VAT, stamp duties, ATM fees and electronic transaction charges.

Industry analysts say many of these deductions are within regulatory approval. The challenge, however, is not legality but clarity.

Most customers struggle to distinguish between statutory charges, bank fees and charges collected on behalf of payment infrastructure providers.

What exactly are Nigerians paying for?

Under existing regulations, electronic transfers above certain thresholds attract prescribed fees. Stamp duty applies to qualifying transactions, while VAT is charged on selected banking services.

Recent ATM policy adjustments also introduced additional charges for withdrawals from other banks’ ATMs, particularly off-site machines in malls and airports.

Consumer advocates argue that while these charges may be legal, the communication around them is weak.

Many customers only see deductions after transactions are completed, while account statements often contain abbreviated or technical descriptions that are difficult to interpret.

Lessons from African country like Kenya

Kenya’s mobile money ecosystem is often cited as a model for pricing transparency. According to the Consultative Group to Assist the Poor, CGAP, 2018, the country’s regulatory framework requires mobile financial service providers to disclose transaction charges to users before payments are completed, enabling customers to see applicable fees upfront and make informed decisions.

Charges are regulated, not arbitrary – BCAN

President of the Bank Customers Association of Nigeria, BCAN, Dr. Uju Ogubunka told Vanguard that most deductions are regulated under the CBN’s Guide to Bank Charges.

He insisted that many complaints stem from lack of awareness rather than illegal deductions.

“There is a document called the Guide to Bank Charges. If you follow that document, you will see the kind of charges banks are allowed to charge and the extent they can go,” he said.

He added that customers have a responsibility to familiarise themselves with the guide.

“It is not new. It has been there for about three, four, five years or more,” he said.

Ogubunka maintained that charges such as stamp duty, SMS alerts and transfer fees are legitimate. “The charges are not too much. They are normal. Some of them are even statutory, like stamp duty,” he said.

He, however, advised customers to question deductions where necessary.

“If banks overcharge them, they will be able to know and complain for remedial action,” he said.

There’s room for improvement — Lotus Bank

In an interview, the Chief Digital Officer of Lotus Bank, Akin Adegoke, said most charges seen by customers are regulatory or transaction-based fees guided by the CBN.

He noted, however, that communication remains a key gap.

“The fees customers see are regulatory or transaction-related charges guided by CBN regulations, including transfer fees, SMS alert charges, and other statutory fees banks are required to disclose. Still, this is an area where clarity can be improved,” he said.

According to him, banks are working to improve transparency through clearer statements, digital alerts and better customer communication.

He added that the bank continues to engage regulators to strengthen trust and improve customer experience across banking channels.

Financial inclusion at a crossroads

As Nigeria’s digital payment ecosystem continues to expand, experts say the focus must shift from simply increasing financial inclusion to building trust through transparency and consumer education.

While millions now use digital financial services, unclear charges and poor understanding of deductions could undermine confidence and slow further adoption, particularly among vulnerable users.

•This report is supported by the DPI Africa Journalism Fellowship Programme of the Media Foundation for West Africa and Co-Develop.