What to expect from your bank

First, banks are meant to receive the customers' cash, cheque and
other instruments directly from the customer or from a third party
into the customers' account in so far as the transaction process
comply with extant rules and regulations. This is one of the most
fundamental duties a bank owes its customers.

Conversely, the customer should expect his money to be paid back to
him on demand in form of honouring his cheque or any other withdrawal
instrument in so far as the amount in the customer's account covers
the demand unencumbered. The customer just makes a demand on a bank,
the bank is duty bound to honour such demand. This duty is, however,
subject to two conditions: absence of legal directive to the contrary
(e.g. frozen account); and sufficient funds in the customers' account
or approved overdraft. In the case of overdraft, a bank is obliged to
honour withdrawals up to the approved limit.

The customer should expect to have his account and the transactions
thereof protected as a personal secret. Banks are obliged to ensure
confidentiality and not disclose information relating to the
customers' account to a third party. The bank is also under obligation
to protect details of customers' accounts from unauthorised access by
third party. There are, however, exceptions to this general rule as
follows: Where the bank is required by a law court to make disclosure;
and where the customer consents to the disclosure in writing.

In case the bank wants to close the customers' account for whatever
reason the customer should expect reasonable notice and time before
his account can be closed without regard to whether the account is in
credit or overdrawn. The essence is to give the customer sufficient
time to arrange for an account with a different bank.

The customer should expect his statement of account regularly whether
or not he requested for it. The provision of the extant regulation in
Nigeria is that banks are required to provide their customers free
statement of account on a monthly basis. Any special request, however,
attracts a fee of not more than N50 per page as provided in the Guide
to Bank Charges.

A bank customer should expect his bank to obey his instructions
regarding transactions in his account within the terms of the
relationship provided there is no legal requirement stopping the bank
from doing so.

The customer should expect the bank to duly credit his account with
the stated deposit interest rate as and when due. This is usually
simple with fixed deposit accounts and some specialised products but
not as simple with current and savings account which are incidentally
the most common amongst the low net worth customers.

It will be proper to also give the other side of the bargain where the
customer should also expect the bank to exercise some rights and
privileges over his account.

One of these is that the customer should expect the bank to charge
mutually agreed interest on credit facilities granted to customers and
allowable fees for services rendered. We had earlier published these
charges and fees as approved by CBN but we may revisit it after this
series.

The customers should also expect the bank to possess and retain goods,
securities or any other assets belonging to the debtor (customer)
until the debt is fully repaid(right of lien) and this coupled with
the banks' right to sell (without recourse to court) a property over
which the customer has created a legal mortgage in favour of the Bank.

The customer should expect the bank to dishonour a cheque improperly
drawn or not to act on an instruction to pay from a legally frozen,
unfunded or insufficiently funded account.

There is also the controversial issue of the banks' practice of
debiting the customers' account upon expenses incurred on behalf of
the customer. We know that most banks abuse this but the standard is
that the customer should be duly informed before the expense is
incurred

The customer should also expect the bank to combine accounts owned by
a customer in same bank to pay a balance owed by the customer due to
an overdrawn position in an account. It is called right of set-off.
This can only be applied if there is no agreement to the contrary.

Culled from Punch.