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Business News of Tuesday, 28 June 2022

Source: nairametrics.com

Nigerians react as MTN drags 18 banks to court over N22.3 billion ‘erroneous’ transfer

MTN office MTN office

A lawsuit involving MTN Nigeria’s MoMo PSB and 18 Nigerian banks has been generating reactions from Nigerians. While reports say MoMo had dragged the banks to court to retrieve N22.3 billion “erroneously transferred to 8,000 bank customers”, many are blaming the banks for being tightfisted when it comes to refunding money.

Reacting to the report on Twitter, bank customers who had experienced difficulty in getting refunds for failed transactions said getting a reversal of funds from Nigerian banks could be very tough. Others are also accusing the banks of trying to stiffle innovations brought by the PSBs and fintechs.

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However, in this case, the banks may not be the culprit as the money was said to have been transferred to customers’ accounts, some of whom may have withdrawn and spent the money.

The lawsuit

In a suit marked FHC/L/CS/960/2022 and filed on May 30, 2022, the PSB asked the court to declare that the deposits worth N22.3 billion belonged to it (Momo PSB) and not the banks’ customers.

The affected banks, listed as defendants in the suit, are Access Bank, Ecobank, Fidelity Bank, First Bank, First City Monument Bank, Guaranty Trust Bank, Heritage Bank, Polaris Bank and Providus Bank. Others include StanbicIBTC, Standard Chartered, Sterling Bank, Suntrust Bank, Union Bank, United Bank for Africa (UBA), Unity Bank, Wema Bank and Zenith Bank.

What they are saying

Reacting to the report via a Twitter thread, a tech investor, Victor Asemota said: “For MTN to be taking the banks to court in Nigeria means that they have exhausted all other means. This is MTN, the most valuable company in the country having problems with banks. You can imagine what a small fintech deals with. Even a regular customer. Till today, my money vanished.”

“Banks will doom whatever progress is being made with financial services until they are replaced. The best way to replace them will be alternate integrations,” he added.

Another popular Twitter user, Rinu Oduala said: “Nigerians banks are so terrible. Ordinary POS payments are untraceable for them.”

Reliefs being sought in the suit by MoMo PSB

In the suit filed by Lotanna Okoli, a senior advocate of Nigeria, on behalf of MoMo PSB, the company is seeking:

“A declaration that the deposits of an aggregate sum of N22,300,000,000.00 erroneously transferred by the plaintiff to the accounts of the customers of the defendant banks, having been done in error, belongs to the plaintiff and not the customers of the defendant banks,” the court filing reads.

“An order directing the defendant banks to each, individually, account for the sums available in their customers’ accounts and the sums which have been removed by the customers and are no longer available.

“An order directing the defendants’ banks to immediately return the aggregate sum of N22,300,000,000.00, less those funds that are no longer available, to the plaintiffs’ settlement account in the name MOMO PSB settlement account number: 2041379385 at First Bank Plc Samuel Asabia House 35 Marina, Lagos, from where the funds originated.

“An order directing the defendant banks to release all information, including account name information in respect of the accounts from which the plaintiff’s funds have been transferred to third parties, including the destination accounts and the banks in which they are held to assist in the tracing and recovery of those funds.”