In a bold move, Sterling Bank has abolished transfer fees for all local online transactions, setting a new standard for customer-centric banking in Nigeria. This decision has sparked widespread acclaim and calls for other banks to follow suit, particularly in light of recent criticisms over exploitative charges in the banking sector.
Sterling Bank's initiative comes as Nigerians have increasingly voiced concerns about hidden and excessive fees imposed by banks. Osita Chidoka, a prominent advocate for financial reform, has praised Sterling Bank for "doing the math and choosing the people" by giving up approximately ₦13.56 billion in transfer charges, 4.13% of their total revenue. This move is seen as a significant gesture towards easing the financial burden on Nigerians, especially when compared to other major banks that continue to profit heavily from transfer fees.
Financial Impact
In 2024, four major banks: Zenith, GTCO, UBA, and First Bank-collected a combined ₦186 billion from transfer fees alone. This amount exceeds the combined federal allocation to several major universities and is roughly 60% of Yobe State's 2025 budget. Despite these substantial revenues, removing transfer fees would only marginally affect these banks' overall profits. For instance, GTCO's transfer charges account for just 1.22% of its revenue, while UBA and Zenith Bank's figures are similarly low at 1.52% and 2.02%, respectively.
Public Reaction and Advocacy
Osita Chidoka has announced plans to open a Sterling Bank account as a gesture of support and to encourage others to do the same, using the hashtag #OpenSterlingAcct Day. This move is part of a broader call for transparency, innovation, and fairness in the banking sector. Chidoka's advocacy highlights the need for consumers to "vote with their wallets" and demand better from banks, emphasizing that change will only occur if consumers actively seek it.
Industry Implications
Sterling Bank's decision has placed pressure on other financial institutions to reassess their charging structures. As digital banking continues to grow, the elimination of transfer fees could become a competitive advantage, potentially leading to a shift in how banks approach customer service and revenue generation. The move also underscores the importance of consumer advocacy in driving change within the banking sector.