The CBN Issues Its Consumer Protection Framework

The age–old business mantra, “the Customer is King” rings true as the Central Bank of Nigeria (“CBN”) recently unveiled its Consumer Protection Framework (the “Framework”) on the 7th of November 2016 for consumers of financial services in Nigeria.
Highlights of the Framework

Principles on consumer protection
The Framework formulates nine (9) key principles for consumer protection which include responsible business conduct , financial education, adequate disclosure and transparency, fairness, competition, protection of assets, data and privacy  ,effective legal and regulatory structures, complaint handling/redress and  enforcement procedures.

These principles will act as underlying guidelines for  evaluating the actions of financial institutions as well as a measure for checking the adequacy of the Framework and subsequent guidelines issued pursuant to same to protect consumers.

Rights of consumers
Consumers are now entitled to accurate and timely information from their financial institutions and education on financial products and free choice of products, a conducive and safe banking environment. These institutions are required to maintain confidentiality, fairness and have an efficient redress mechanism under the Framework.

By highlighting out the above rights, the Framework provides clarity to the consumers on their legal rights which, if infringed, can be addressed by the CBN. The compliance units in the financial institutions will also be on alert to ensure that their internal procedures are in sync with the consumer rights.

Duties of consumers
The corresponding duties of consumers to financial institutions include honouring financial obligations, protecting financial instruments/information, providing accurate/current information as well as reporting unethical practices, fraud and error.

The duties of consumers noted in the Framework serve to balance out the rights granted to them under the Framework.

Sanctions on defaulting financial institutions
The sanctions regime under the Framework is robust as the CBN may impose sanctions on financial institutions ranging from instructions to issue a letter of apology to consumers to the suspension and removal of the board of the financial institutions.

The above sanctions will act a check to the abuse of consumer rights by financial institutions.


The Framework appears well-timed amidst the increasing concerns by consumers on unethical practices and imposition of arbitrary charges by financial institutions. It is a step in the right direction for the CBN in relation to consumer protection and the eventual development of varied regulatory/supervisory instruments to achieve its goals and look forward to improved banking services by our financial institutions going forward.