How Heritage Bank boost deposit base through zero COT

Cost on Transaction (COT) has been a great challenge in the banking industry, considering the huge charges being inflicted on customers by the deposit money banks.

However, considering the fierce competition in the sector, this is one of the ways a creative bank can retain customers or get attracted to new ones by either reducing it or completely removing it, in what is called zero COT.

One of the jobs of Heritage Bank is to help people actualise their dream by supporting them, not only financially but in other ways. The bank also aims at taking people from the ordinary banking to real banking.

This is becoming evident at the bank, as it commenced a zero COT offer to its numerous clients from April 15, 2013. Offering zero COT implies there shall be no hidden charges in transactions.

Consequently, this huge selling point will boost the bank’s deposit base as it warms up to serve its comers as they come in number.

Apart from offering zero COT, customers can also enjoy interest on their accounts within certain maintained balances.

The introduction of the free banking by Heritage Bank is coming at a time the Bankers’ Committee of the Central Bank of Nigeria (CBN) is bent on investigating the excessive charges imposed on customers by deposit money banks. The development is coming on the heels of bank’s customers continued outcry on fresh and arbitrary charges imposed on them by the banks.

Heritage Bank emerged from former Societal Generale Bank of Nigeria (SGBN), having met the CBN’s requirement to operate as a regional bank.

The bank had some challenges with capitalisation as a result of the capital review by the CBN in 2006/2007. Before then, they have had some challenges with clearing and so on.

Read also: Heritage Bank introduces Customer reward scheme

Ifie Sekibo, the bank’s managing director/CEO, said “we came in as core investor when all attempt to capitalise the bank failed. We made a bid like every other person to see if we can re-capitalise it and on that basis, we were able to win that bid. We had negotiation with the legacy investor or former investor of the bank and came up with an agreement. We re-capitalised to the tune of N12 billion, take up all liabilities and assets of the bank and found some form of accommodation for depositors whose money has been trapped for 10 years. In a nutshell, that is the bank transiting from SGBN to Heritage Bank.

“Our vision is simple and clear; today, we might look quite new in the market, but our idea of what this bank should be is clear from day one. We want to be a bank that people will believe and know that generation banking is the way to go.

“When we say generation banking, we are basically saying it is not enough to amass wealth and when you die, you write a Will and somebody carries the Will and walk away. They fight over your Will or whatever, lawyer spends some part of the Will money and we don’t know what is up. We want a situation where your life is a continuum of what legacy you left behind. At the end of the day, the true wealth we have is our name. So, we are trying to see if we can re-focus our clients to begin to think of it in that line; to say if I have to leave a name, what kind of name will I leave behind?

“That name should be the legacy. If it is the wealth I left behind, what is that wealth? It does not have to be cash, it could be industry, that wealth could be an art gallery, that wealth could be a big factory, that wealth could be an invention, but I have to leave it for those people I work for and bear my children, my family, which is why we call it generation banking. Our objective to achieve that is to be about the best knowledge driven organisation technologically.

And above all, being able to show the customer that in truth, service is what will make it possible. We don’t say we know what the customer wants, we can’t claim. We can’t serve what we think is best for him, rather we would like the customer to tell us what he or she wants us to do for him or her. We would serve the customer better when