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Nigerians Cry out as Banks Deduct Stamp Duty on Transactions

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Banks may have added to the worry of Nigerians who are already struggling to make out a living during the period of COVID-19 crisis as payment of stamp duty takes effect.

Nigerians Cry out as Banks Deduct Stamp Duty on Transactions

The Finance Act, 2019 resolved the controversy over the legality of the N50 stamp duty on electronic receipts and transfer of funds by setting the threshold for the charge at N10,000 for all types of accounts.

According to International Centre for Investigative Reporting (ICIR)  Nigerians have expressed frustration on various platforms over this deduction and its impact on their finances.

Adeoye Martins a  sales boy in Abuja who spoke to The ICIR said: ” UBA has deducted about N1,500 from my account in the name of stamp duty and the money in my account is not mine, I have to look for the money back.”

Silas Mathias said, “These banks are just ripping us off, I would take my money away from the bank and keep at home before I wake up one day and they have deducted all I have.”

A Twitter user @Prisielebz and an Access Bank customer tweeted, “I don’t understand the debits made by Access Bank on customers’ accounts in the name of stamp duty. What exactly is going on?”

Another twitter user @banadvinice117 posted: “@UBAGroup @UBAFoundation You guys deducted about 900(50naira x18) between March and April. You’re charging 1,100 for March and Feb AGAIN .. what the hell is stamp duty. I need explanation abeg!!!!!!!!! #DAYLIGHTROBBERY #COVID19.”

According to Price Waterhouse and Coopers (PWC), under the Stamp Duty Act, stamp duty is payable on any agreement executed in Nigeria or relating, whatsoever, to any property situated in or to any matter or thing done in Nigeria.

Instruments that are required to be stamped under the Stamp Duties Act must be stamped within 40 days of first execution.

All deposit banks and financial institutions are required to charge stamp duties of NGN 50 on every eligible transaction above NGN 10,000.

There are exemptions for transactions between accounts held by the same bank customer and for salary accounts.

Guaranty Trust Bank sent out emails to customers saying “Please be informed that in line with Central Bank of Nigeria (CBN) new directives, stamp duty now applies to all accounts.”

N50 will be charged on our savings account on all deposits and electronic transfers from N10,000 and above, while N50 will be charged on current account on all deposits and electronic transfers from N1000 and above

However, please note that deposits made to self and transfers within the same bank are exempted from the charge.

United Bank of Africa (UBA) also sent emails to customers saying “On February 1st 2020, the Federal Government of Nigeria (FGN) released a policy directing all banks to apply a stamp duty charge of ₦50 to all inflows of ₦10,000 and above.”

“You may have noticed this charge on a few of your transactions from April 1st 2020. The charges for February and March 2020 will be deducted from your account on May 9th,” the email revealed.

Peter Egun the ATM officer for Zenith Bank who spoke to The ICIR said: “If any customer receives cash deposit and not via online transfer the bank would take out stamp duty from N10,000 above.”

Charles Adepoju a cash officer with Access Bank said it is a directive from CBN, “and the banks have to take the charges for stamp duty, who would bear the cost if not deducted.”

Seyi Kolawole a Research Analyst at NASD PLC said stamp duty is important, but he thinks CBN should not have started now.

“They should have waited till when the current hardship has reduced in the country,” he said.


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Customers to Access up N3m in New UBA Credit Card, Flexible Repayment Plans

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United Bank for Africa (UBA) Plc, Pan African financial institution, has introduced the new UBA Naira Credit Card to its teeming customers in fulfilment of its promise to ease accessibility to funds and improve the overall standard of living.

Customers to Access up N3m in New UBA Credit Card, Flexible Repayment Plans

Kennedy Uzoka

With the new UBA Naira Credit Card, customers whose salary accounts have been domiciled with the bank for a minimum of three months and are employees of corporates under UBA’s approved counterparty list with minimum net monthly income of N250,000 are in for a stress-free business and personal lifestyle.

They will be qualified to access up to N3m credit, with extremely flexible repayment plans of as low as 10% of their monthly outstanding due.

Specifically, these customers aged between 18 and 57years who apply for the UBA credit card will also enjoy easy access to funds with a revolving line of credit and up to 45 days interest free credit, flexible repayment options; amazing discounts at select merchant locations including Restaurants, Boutiques, among other mouth-watering benefits.

The UBA credit card also allow ATM withdrawals in Nigeria or abroad wherever the Visa logo is displayed while allowing ease of payment of goods and services locally and Internationally on POS/WEB terminals where the Visa logo is displayed.

Sampson Aneke, group head, Digital Banking, UBA, said that as a bank that is interested in the welfare of Nigerians, UBA is always on the forefront of developing products and services aimed at creating wealth, easing living conditions and meeting the needs of its customers all over the world.

He said, “At UBA, we recognise that access to credit is fundamental to the creation of wealth and value in the economy.  Unfortunately, the country has been challenged in this regard with only about 2% of the population presently having access to bank loans.

“It is in addressing these developmental and household challenges that the bank has in recent times developed and introduced a number of unique lending products to the market, with the latest being the innovative UBA credit card.”

Aneke who spoke glowingly about all the benefits that the banks’ customers stand to enjoy from the credit card explained that the UBA Credit card is currently available as Visa Gold card with a card limit of between N75,000 to N1,000,000 and Visa Platinum card with a limit of between N1,000,001 to N3,000,000 and can be used locally and internationally at any ATM or POS outlet which has the Visa logo, WEB (online), and POS terminals.

“There is an interest free period  of 45 days on POS/Web transactions provided 100% repayment is made on the repayment due date and customers are entitled to 30% (annualized) of their monthly salary as credit card limit subject to the existing Debt Service Ratio (DSR).  The monthly repayment cycle will run from the 15th of every month to the 15th of the next month and the credit card statement showing transactions details within the period and the amount due for repayment will be sent to the cardholders’ registered email address,” Aneke said.

He explained that to get the card, customers can walk into any UBA branch or visit the bank’s website at www.ubagroup.com to download the credit card application form, fill it and submit to the Customer Service Officer at any UBA branch nationwide.

United Bank for Africa is a leading pan-African financial institution offering banking services to more than twenty million customers globally.

With footprint in 20 African countries and presence globally in the United Kingdom, the USA and France,

UBA is connecting people and businesses across Africa through retail, commercial and corporate banking, innovative cross border payments and remittances, trade finance and ancillary banking services.


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Access Bank in Discussion For Acquisition Of Zambian Bank

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Access Bank Plc has entered into exclusive discussions with Cavmont Capital Holdings Zambia Plc on the acquisition of Cavmont Bank Limited.

In a regulatory filing at the Nigerian Stock Exchange (NSE), Access Bank said the discussions bothered on a potential transaction between Access Bank Zambia and Cavmont Bank Limited, a wholly owned subsidiary of Cavmont Capital.

“The potential transaction relates to the sale of 100 per cent of Cavmont Capital’s interest in Cavmont Bank to Access Bank Zambia. There can be no certainty that a transaction will be agreed, nor as to the terms of any such agreement”.

According to Access Bank, the completion of a transaction would be subject to formal regulatory approvals.

“Access Bank will update the market as appropriate and in accordance with its’ disclosure obligations,” it said.

Accordingly, shareholders are advised to exercise caution when dealing in Access Banks securities until a full announcement is made.


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Record US COVID-19 Cases Can’t Halt the Equity Rally

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By Hussein Sayed, Chief Market Strategist at FXTM

Equity markets have pushed higher in Asia following an impressive last hour rally on Wall Street yesterday. The record daily increase in US COVID-19 infections and the sharp rise in deaths has proved no barrier to the bulls. Rises in Apple and Amazon stocks sent the Nasdaq Composite to a new record high of 10,492, while the S&P 500 and Dow Jones Industrial Average advanced 0.78% and 0.68% respectively.

The current environment has led to the closure of the $2.8 billion Lansdowne Partners’ flagship equity long/short hedge fund. The lack of short winning strategies may even force more hedge funds to follow Lansdowne’s footsteps. The stimulus-driven market has made life for long/short strategies extremely difficult as relying on traditional valuation metrics to find short opportunities have failed throughout the latest bull market, and even throughout much of the previous 12 years since the Great Financial Crisis.

Fundamentals and valuations appear to be of limited influence on investor’s decision making. The fear of missing out, or “FOMO”, monetary and fiscal policy actions, low yields, lower interest rates for longer, are some of the factors that have led to this structural change in markets. If the Fed can keep zombie companies alive by keeping the lending taps open, why wouldn’t investors profit from these actions? However, the Fed cannot keep running these measures forever, and for many corporates relying on debt to stay afloat, sooner or later they will fail if they can’t return to profitability.

As always there is the good and the bad news. Depending on where investors put more weight is what drives asset prices and that is what leads to extreme highs and lows. Looking at where US stocks stand at the moment, it seems lots of the good news is already priced in. So even if bulls decide to keep pushing higher, the upside is likely to be limited from current levels unless we learn that an effective vaccine will hit the markets before year end and will be available for most of the population. If investors truly believed that the economy was returning to pre-pandemic levels soon, Gold wouldn’t be standing today at 9-year high, so it’s evident that investors who are participating in this risk-on rally are also hedging their positions by adding safe havens for their safety net.


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