The three free monthly withdrawals that were previously permitted for customers’ use of ATMs operated by other banks have been discontinued by the Central Bank of Nigeria (CBN).
The CBN instructed all banks and financial institutions to impose new ATM withdrawal fees starting on March 1, 2025, in a circular accessed by BrandSpur banking and finance news desk, dated February 10, 2025. Customers will now be responsible for paying for each withdrawal they make from an ATM operated by a different bank. Section 10.7 of the CBN Guide to Charges by Banks, Other Financial, and Non-Bank Financial Institutions (2020) contains the charges that are impacted by the review.
It is anticipated that the circular, which was issued by John Onojah, Acting Director of the CBN’s Financial Policy and Regulation Department, will hasten the nationwide rollout of ATMs while guaranteeing that financial institutions impose reasonable fees for the service.
According to the circular: “The three free monthly withdrawals allowed for Remote-On-Us (other bank’s customers/Not-On-Us consumers) in Nigeria under Section 10.6.2 of the Guide shall no longer apply.”
Withdrawals from a customer’s bank ATM will continue to be free under the new rule. However, when using ATMs on bank property, clients of other banks will henceforth be charged N100 for each N20,000 withdrawal. A fee of N100 will be applied for each N20,000 withdrawal made at off-site ATMs, in addition to an N500 surcharge. At the time of withdrawal, the surcharge—which will be the deployer or acquirer’s revenue—must be declared.
International ATM withdrawals will be billed at the precise rate determined by the foreign acquirer, the CBN added. The top bank ascribed the evaluation to the need to improve ATM operations’ efficiency and growing costs.
Continuing, the circular partly reveals: “In response to rising costs and the need to improve the efficiency of Automated Teller Machine (ATM) services in the banking industry, the Central Bank of Nigeria has reviewed the ATM atransaction fees prescribed in Section 10.7 of the extant CBN Guide to Charges by Banks, Other Financial and Non-Bank Financial Institutions, 2020 (the Guide).
“This review is expected to accelerate the deployment of ATMs and ensure that appropriate charges are applied by financial institutions to consumers of the service. Accordingly, banks and other financial institutions are advised to apply the following fees with effect from March 1, 2025,” it added.
Customers of the banks who often use ATMs owned by other banks will now pay more as a result of the additional fees. Increased reliance on digital banking channels like online transfers and smartphone apps may result from the implementation of higher levies on off-site ATMs.
Furthering, customers may need to change their banking practices to avoid extra fees as banks are anticipated to apply the new structure from March 1. The decision from the CBN is in line with continuous initiatives to encourage cashless transactions, a practice that has drawn more regulatory interest recently.
Following the CBN’s warning to banks that any bank found to be failing to disburse cash via ATMs would face sanctions, this assessment of ATM charges took place. Nine Deposit Money Banks were recently fined N1.35 billion by the CBN for neglecting to guarantee cash availability through ATMs throughout the holiday season. Following spot checks that showed non-compliance with the apex bank’s cash distribution norms, each bank was fined N150 million.
The following banks were impacted: United Bank for Africa Plc, Globus Bank Plc, Providus Bank Plc, Zenith Bank Plc, Fidelity Bank Plc, First Bank Plc, Keystone Bank Plc, Union Bank Plc, and Sterling Bank Plc. The banks’ CBN accounts will be immediately debited for the fines.
