Editorial
Banks, Workers’ Salaries And Hidden Charges
The activities of some commercial banks
in Nigeria, especially with regard to
charges on workers’ salaries and deductions on soft loans, have become rather unacceptable. In some cases, it has led to illegal reduction of salaries through double taxation.
While public servants are still contesting the prevailing taxation of their salaries, the banks further deplete the miserable pay packet by deducting value added tax and a list of other charges that serve only to raise the blood pressure of the average worker.
Consequently, a greater percentage of public servants have gone back to the banks to obtain soft loans just to meet up. With loans called “Sharp-Sharp”, “No Wahala loan” among others, are accompanied by high interest rate and another regime of deductions that give the impression that nobody monitors the banks.
While the banks apply different sharp practices in a bid to meet their usually bogus annual revenue projections, the victims (their customers) count their losses and come to the painful conclusion that banking is detrimental to their interest.
Banks, at will, deduct account management fees, Cost of Transaction (COT) and Value-Added Tax (VAT) on COT, among other charges at rates solely determined by them and sometimes do this more than once in a month.
Public servants appear to be the worst hit as they often obtain soft loans to enable them pay house rents, school fees, purchase vehicle, or meet other domestic obligations like burials only to realise that they had unwittingly cut a deal with the ‘devil’.
With the progressive drop in the salaries of government workers lately, the many phantom charges by banks have made the average worker even more desperate and disillusioned. This cannot continue to define the fate of the people even if the labour unions fail to respond to the groaning of the workers.
Also disturbing is the purported drop in the nation’s inflation rate to eight per cent and the report that the economy is improving without a corresponding impact on the living condition of the average citizen. It is sad to notice that the banks still charge more than 20 per cent interest on soft loans even as they pay less than two per cent interest on deposits.
Whereas the banks lure civil servants with the Central Bank of Nigeria (CBN’s) approved prime lending rate of 18 per cent, they have been discovered to base their monthly interest deductions on a 23.9 per cent maximum lending rate.
Again, the CBN recently directed banks to stop the N100 per transaction charge on customers for the use of Automated Teller Machines (ATMs), some customers still allege receiving notifications on ATM charges, sometimes even when there were no such purported transactions; some banks now call it ATM maintenance fee.
Some banks now take advantage of the fact that many account holders hardly study the details of their monthly bank statements, or even bother to question the legitimacy of strange deductions. Even those who dare to ask often get frustrated after several calls or visits to the banks without convincing explanations.
The Tide believes that it is high time government took up the matter with the banks to ensure that salaries are not reduced in ways that leave the worker underpaid. In fact, the workers’ union ought to take the first interest in this matter and check the impunity of the banks.
We think that this also calls for more inclusive and robust housing/vehicle loans for public servants, especially as their living standards have been seriously altered by the unexpected deductions in their salaries.
The CBN should do more than merely encouraging short-changed bank customers to channel their complaints to its Consumer Protection Department. In fact, it should act in concert with the National Deposit Insurance Corporation (NDIC), Securities and Exchange Commission (SEC) and the National Assembly Committees on Banking and Finance to bring to an end this fraudulent banking system that discounts the interest of the customer.
There are moments in the life of a legislature when plain speaking becomes a public service. Senator Adams Oshiomhole provided such a moment on the floor of the Senate when he accused the Minister of Works, Senator David Umahi, of manifestly neglecting critical federal arteries in Edo and Delta States, and implored his colleagues to prevail on the Minister to adopt a more equitable and genuinely national approach to road infrastructure delivery. It was blunt, it was uncomfortable, and it was necessary.
The specifics of his complaint deserve restating. Drawing attention to the recent approval of some 20 new road projects despite the parlous state of existing ones, the former Edo State governor lamented that Nigerians cannot travel from Benin to Warri, Benin to Asaba, Benin to Auchi, or Auchi to Okene without encountering severe distress. He alleged a deliberate omission of these corridors from the national budget in the last three years, save for palliative interventions directed by President Bola Tinubu through tax credit arrangements. His question — “What have we done wrong?” — resonates far beyond the chambers of the National Assembly.
We lend our full and unequivocal support to that call. The Auchi-Benin Road, for instance, has been in a deplorable and near-impassable condition for several years, turning what should be a two-hour journey into an all-day ordeal of broken axles, extortionate fares, and despondent commuters. The media have, on multiple occasions, chronicled the suffering of motorists, traders, and students who ply that route. To describe it as a federal road today is to stretch the meaning of the term beyond recognition.
This pattern of sidelining is not confined to Edo or Delta. Even here in Rivers State, the disposition of the Federal Ministry of Works has left much to be desired, particularly along the Eleme axis of the East-West Road. That road, which ought to be a flagship of federal presence in the Niger Delta, has remained in a wretched state for long. Those who use it daily — workers at the Eleme Petrochemical Complex, the two refineries, Onne Port, and the countless ancillary industries — can attest to its deterioration. Work has proceeded in fits and starts without the sustained urgency such a strategic road demands.
The Eleme stretch is not a mere intra-state byway. It is the gateway to the nation’s economic jugular. According to the Federal Ministry of Works and Housing’s 2023 Highway Condition Survey, only about 35 per cent of the country’s 36,000 kilometres of federal roads are rated as being in good or fair condition, with the remainder classified as poor or very poor. The East-West Road, conceived in the 1970s to bind the entire Niger Delta, remains unfinished in critical sections more than four decades after. If it had been treated as a priority, the perennial gridlock, carnage, and economic loss on the Eleme-Refinery junction would have long been consigned to history.
The irony is as painful as it is glaring. The Niger Delta remains the goose that lays the golden eggs. Data from the Nigeria Extractive Industries Transparency Initiative [NEITI 2023 Oil and Gas Audit] show that the region still accounts for over 78 per cent of Nigeria’s federally collected export earnings and about 65 per cent of total government revenue. The National Bureau of Statistics [NBS Foreign Trade Report Q4 2024] similarly confirms that crude oil continues to dominate export receipts. By every metric of equity and economic logic, a region that sustains the national purse deserves first-rate consideration in the allocation of infrastructure, not afterthoughts and tokenism.
Road infrastructure is not largesse to be dispensed by favour; it is the skeleton upon which commerce, cohesion, and citizenship hang. When contracts are concentrated in one geopolitical zone while other zones are left to contend with craters, it erodes trust in the federation itself. The World Bank’s Nigeria Development Update [June 2023] estimated that poor transport connectivity inflates the cost of moving goods by up to 40 per cent and costs the Nigerian economy an estimated $1.5 billion annually in lost man-hours and vehicle maintenance. If we profess to be one country, then equity must be the compass that guides key institutions before any project is executed. Development must spread round, not pool in one place as though other regions do not matter.
There is also a grave security dimension that can no longer be ignored. The deplorable condition of federal roads has become a veritable enabler of criminality. The NBS Crime Experience and Security Perception Survey reported over 2.5 million incidents of kidnapping-related occurrences nationally, with transport workers identifying bad road spots as prime ambush points. When vehicles are forced to crawl at 10 kilometres per hour through failed sections at Auchi, Sapele Road, or Eleme, they become sitting ducks for armed gangs. Fixing bad roads, therefore, is not merely about convenience; it is about safeguarding lives.
By his intervention, Senator Oshiomhole has hit the nail on the head and reminded Minister Umahi of a fundamental constitutional truth: public office is held in trust. The Ministry of Works is not a personal estate where contracts are awarded according to whim or political convenience. It is a national institution funded by the collective resources of Nigerians, including the oil and gas rents from the very communities whose roads are now neglected. The Minister must demonstrate balance, transparency, and a pan-Nigerian outlook in the distribution of projects that impact the daily existence of citizens. Selective neglect breeds suspicion, and suspicion is corrosive at a time when the nation is preaching unity, oneness, equity, and justice.
Consequently, the National Assembly must go beyond rhetoric and assert its oversight powers with vigour. Sections 88 and 89 of the 1999 Constitution [as amended] empower the legislature to investigate and expose any maladministration in the execution of federal projects. If an office holder is not acting rightly, it is the duty of the Senate and the House of Representatives to call him to order. Oversight must not be reduced to budget approval ceremonies; it must translate to field verification, public hearings, and insistence that the Federal Character principle, as enshrined in Section 14(3) of the Constitution, reflects in road awards.
Let the Auchi-Okene, Benin-Warri, Benin-Asaba, and Eleme East-West gangways be restored to motorable dignity. Let priority be given to completing existing, economically vital roads before embarking on new ones. If those who, through their resources, sustain the federation are sidelined in the distribution of tangible dividends, it tells poorly of our nationhood. Bad roads must be fixed, and they must be fixed now, with fairness as the guiding standard.
