‘No longer bank of the free’ — Customers react as Kuda Bank introduces N50 stamp duty

Customers expressed disappointment as Kuda Microfinance Bank introduced N50 stamp duty on all deposits of N10,000 and above.

On Monday, in a pop-up message to customers via its app, the bank said the N50 introduction was in line with the federal government’s Stamp Duty Act.

The bank said the stamp duty deduction applies to all electronic transfers and would commence on July 15, 2022.

“In line with the federal government’s duty act, we‘re required by law to apply a N50 charge to all depositors of N10,000 or more made into your Kuda account,” the message reads.

“This charge will apply to the following kinds of deposits from Friday, July 15, 2022; electronic transfer, money added to your account with a debit card, and cash deposits made into your account at any of our partner banks.”

Highlighting that the bank gains nothing from the N50 charges, the bank explained that the charges would be remitted to the federal government.

“We don’t gain anything from the charge. All financial institutions have been directed by the federal government to apply the charge, and we hand over the entire charge to the government,” the bank explains.

“We will continue to do our best to give you free financial services that you can rely on, including covering the cost of your first 25 transfers to other banks every month. Please note that the charge will apply from Friday, July 15, 2022.”

Reacting to the development, Maxwell Osarenkhoe, a customer with Kuda bank, said the bank has failed to keep to its word as a ‘bank of the free’, which is its motto and watchword.

“What attracted me to Kuda bank is the ‘free charges’ idea they sold to me as a customer,” he said.

“To be fair, I have been enjoying their services but with these new charges, it entirely defeats the purpose of seeking shelter under an MFB. Now there’s not much difference from traditional banks.”

A Twitter user with the handle @Gifted_kabi said he felt disappointed with the development.

“We came to you because of free transfers. Now you wanna change the format. How can you be charging N50 for both deposits and withdrawals? Good bye” he tweeted.

Kuda Bank

We came to you because of free transfers. Now you wanna change format. How can you be charging #50 for both deposit and withdrawals? Good bye 👋 pic.twitter.com/wXjVflOr2l

Advertisement

— Kabiyesi 1 Onyeoma Na 🇳🇬🇬🇧 (@Gifted_Kabi) July 12, 2022

According to Philip Taiye, a founding customer of the bank, the identity of the bank was built on the premise of free charges, which is one of the reasons many Nigerians consider them and what they have to offer.

“I won’t totally blame them since it is a federal government policy, but this will touch deeply on their identity as they sold the ‘free charges’ story to get customers,” he said.

“I will definitely still be banking with them at least I still have 25 transfer-free charges unlike other banks.”

President Muhammadu Buhari signed the 2020 finance act on December 31, 2020.

The act imposed an electronic money transfer levy of N50 on electronic receipts or transfer of money in the sum of N10,000 and above deposited in any bank or financial institution. The levy is to be paid by the receiver.