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RMAFC to Order Probe of Banks Over Stamp Duty

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stamp duty
  • RMAFC to Order Probe of Banks Over Stamp Duty

Plans have reached advanced stage for the Revenue Mobilisation Allocation and Fiscal Commission to authorise a forensic investigation of the funds that have so far accrued to the Federal Government through the collection of stamp duty.

An investigation by our correspondent showed that the Federal Government had not been satisfied with what the banks had remitted through the Central Bank of Nigeria but the Nigerian Postal Services clashed with the RMAFC when NIPOST initiated moves to probe the banks.

It was learnt that through government system, however, the differences between the two organisations had been resolved, but NIPOST first had to shelve the plan to appoint auditors to probe the banks until it secured approval from RMAFC, which claimed jurisdiction over the matter.

A source close to the development told our correspondent that RMAFC was in the final the stages of releasing the authorisation to enable the appointment of auditors that would investigate the remittances into the Stamp Duty Account domiciled in the CBN.

The Postmaster General of the Federation, Mr Bisi Adegbuyi, had written to the Governor of the CBN, Mr Godwin Emefiele, on the state of the stamp duty being collected on behalf of the Federal Government.

In the letter, Adegbuyi informed the CBN boss of the decision to carry out a forensic audit to determine how much the banks had deducted from the accounts of their customers in order to compare it with what had been remitted by the banks into the Stamp Duty Account.

Subsequently, NIPOST advertised for forensic auditors that would help it carry out the probe of the banks that had been deducting N50 on every deposit with a value of N1,000 and above since January 2016.

The process was aborted when the RMAFC raised the objection of jurisdiction. However, the two organisations had since been working with the Office of the Accountant General of the Federation in order to make the probe possible.

Our correspondent had reported that in the first year of the operationalisation of the Stamp Duty Act (January to December 2016), a total of N3bn was realised through the collection of stamp duty by the banks while N10bn was realised between January and December 2017.

The fund, however, was grossly lower than the expectation of both the government and the postal authorities. Before the operationalisation of the duty, NIPOST had estimated that proper application and collection would see the government collecting about N475bn per annum from the duty, as a study by a private firm had shown.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

Finance

Federal Government Clears $120m Debt to Gas Companies Amid Nigeria’s Power Crisis

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Gas-Pipeline

Amidst Nigeria’s persistent power crisis, the Federal Government has taken a pivotal step forward by clearing a significant portion of its debt to gas companies.

A sum of $120 million has been paid out of the country’s $1.3 billion indebtedness to gas suppliers, offering a glimmer of hope for improved energy stability across the nation.

The Minister of Power, Chief Adebayo Adelabu, underscored the critical role of gas in power generation and highlighted how the mounting debts had severely hampered gas supply to electricity-generating companies, exacerbating the country’s electricity shortfall.

Nigeria heavily relies on thermal power plants fueled by gas for over 70% of its electricity needs, making the timely settlement of gas debts paramount for enhancing power generation capacity and addressing the nation’s energy deficit.

Addressing delegates at the 7th Nigeria International Energy Summit in Abuja, the Director of the Decade of Gas Secretariat, Ed Ubong, expressed optimism about the government’s progress in offsetting its financial obligations to gas producers.

He emphasized the importance of aligning gas and power sectors to foster sustainable energy solutions.

As Nigeria grapples with the multifaceted challenges plaguing its energy landscape, the government’s commitment to settling outstanding gas debts marks a pivotal stride towards revitalizing the country’s power infrastructure and ensuring reliable electricity access for its citizens.

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Finance

Nigeria Insurance Corporation Reimburses Depositors of 179 Closed Microfinance and Four Mortgage Banks

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Retail banking

The Nigeria Insurance Corporation (NDIC) has announced the successful reimbursement of depositors affected by the closure of 179 microfinance banks and four mortgage banks across the country.

The reassuring news came during the 45th Kaduna International Trade Fair, where NDIC’s Managing Director, Dr. Bello Hassan, explained the corporation’s unwavering commitment to safeguarding depositors’ funds amidst financial uncertainties.

Dr. Hassan, represented by Hauwa Gambo, the NDIC’s Deputy Director of Communication, highlighted the corporation’s proactive measures in protecting the interests of depositors.

The introduction of the Single Customer View framework has expedited the process of reimbursing depositors of liquidated banks, ensuring swift and transparent transactions.

The corporation’s collaboration with the judiciary has yielded positive results, facilitating the speedy prosecution of failed insured banks and resolving long-standing cases of bank liquidations like Fortune and Triumph Banks.

This concerted effort has significantly enhanced the debt recovery rate, enabling NDIC to declare full liquidation dividends to uninsured depositors of over 20 deposit money banks.

Furthermore, NDIC has embraced digital remote payment strategies, streamlining electronic funds transfers to verified depositors’ alternate bank accounts.

The introduction of the ‘Deposit Tracer’ initiative in partnership with mobile operators aims to address apathy among depositors with small balances, providing accessible avenues for claiming funds trapped in closed banks.

The initiatives underscore NDIC’s proactive stance in safeguarding depositors’ interests and ensuring financial stability in Nigeria’s banking sector.

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Banking Sector

85.51 Million Nigerian Bank Customers Face Withdrawal Freeze Over NIN, BVN Deadline

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First Bank

As the March 1 deadline looms, an estimated 85.51 million Nigerian bank customers are facing the possibility of frozen accounts due to their failure to link their National Identification Numbers (NINs) and/or Bank Verification Numbers (BVNs) to their accounts.

Recent findings reveal the potential scale of the impending banking crisis.

Data from the Nigeria Inter-Bank Settlement System (NIBSS) indicates that Nigeria had approximately 146 million active individual bank customers as of December 2022.

However, by January 26, 2024, only 60.49 million BVNs were recorded on the NIBSS portal, leaving a significant portion unlinked.

Meanwhile, about 104 million NINs had been issued by December 2023, highlighting the disparity between NIN issuance and BVN linkage.

The Central Bank of Nigeria (CBN) had earlier issued directives to banks, mandating them to restrict transactions on accounts lacking linked NINs and BVNs, with effect from March 1, 2024.

Any accounts found non-compliant risk being designated as ‘Post no Debit,’ rendering them unable to process further transactions.

Responding to the impending crisis, the Director-General of the National Identification Management Commission (NIMC), Abisoye Coker-Odusote, emphasized the need for the revalidation of Front-End Partners (FEPs) to ensure the integrity of the identity database.

She underscored the importance of NIN registration and urged collaboration with various stakeholders to expedite the process.

The Executive Vice Chairman/CEO of the Nigerian Communications Commission (NCC), Dr. Aminu Maida, reiterated the significance of linking NINs to SIM cards to enhance national security.

Telecom subscribers were urged to comply with the NIN-SIM linkage directive to avoid service disruptions.

Meanwhile, financial service providers like Opay have issued reminders of the impending restrictions, urging customers to comply with the linkage requirements.

Amidst concerns, some customers contemplate transferring funds to compliant accounts to avoid potential financial setbacks.

As the deadline approaches, stakeholders are intensifying efforts to mitigate the impact of the impending banking crisis on millions of Nigerians.

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