The Central Bank of Nigeria (CBN) has introduced revised ATM withdrawal charges, increasing fees for customers withdrawing cash from ATMs outside their bank’s network. The new directive, contained in a circular dated February 10, 2025, will take effect from March 1, 2025.
Breakdown of the New Charges
- Withdrawals from your bank’s ATM called “On-Us Transactions” remain free of charge.
- Withdrawals from another bank’s ATM (Not-On-Us Transactions) will be charged
- On-site ATMs (located at bank branches): N100 per N20,000 withdrawal.
- Off-site ATMs (located outside bank premises, e.g., malls, fuel stations): N100 per N20,000 withdrawal + a surcharge of up to N500 per transaction.
- The surcharge, which is an income for the ATM deployer/acquirer, will be clearly disclosed to customers at the point of withdrawal.
- International ATM Withdrawals: Charges will be based on cost recovery, meaning customers will bear the exact fee charged by the international acquirer.
- No More Free Monthly Withdrawals: The previous allowance of three free monthly withdrawals from other banks’ ATMs has been removed. Now, every interbank ATM withdrawal will incur charges.
What This Means for Nigerians
The new ATM withdrawal charges will increase the financial burden on Nigerians, especially small business owners, students, and low-income earners. A trader withdrawing N80,000 weekly from another bank’s ATM could lose nearly N10,000 monthly in fees, while students on campuses with limited ATMs will pay extra just to access their money. With many rural areas lacking ATMs from multiple banks, residents will be forced to pay more or store cash at home, increasing security risks.
This policy is also expected to:
- Increase congestion in banking halls, as many Nigerians may prefer withdrawing cash inside banks rather than paying extra ATM fees.
- Drive up PoS service fees, as more customers turn to PoS agents for withdrawals.
CBN’s Justification
According to the CBN circular, the new charges are designed to:
- Improve ATM efficiency and encourage banks to deploy more ATMs across the country.
- Prevent customers from splitting withdrawals into smaller amounts to avoid charges.
However, many Nigerians view this move as contradictory to the CBN’s financial inclusion and cashless policy goals, arguing that higher transaction costs could discourage banking and digital payments.
Proposed Solutions
Financial analysts and consumer advocates suggest the CBN should:
- Reintroduce three free interbank withdrawals per month to ease the burden on customers.
- Expand ATM networks, especially in rural areas, to reduce reliance on interbank withdrawals.
- Strengthen digital payment infrastructure to make electronic transactions more seamless and reliable.
- Regulate PoS and mobile banking fees to prevent excessive charges in response to rising ATM costs.
With rising inflation and economic difficulties, the new ATM charges could further strain Nigerians already grappling with high costs of living. While the CBN insists that the policy will improve efficiency, it remains to be seen whether it will truly enhance banking services or simply push more Nigerians away from formal banking altogether.
