The Central Bank of Nigeria (CBN) has defended its recent policy of introducing charges on cash withdrawals from Automated Teller Machines (ATMs) of banks other than a customer’s own, stating that it will serve the interests of both financial institutions and their clients.
CBN’s Acting Director of the Financial Policy and Regulation Department, John Onojah, made this clarification while speaking on Channels Television’s *Sunrise* programme on Saturday. He assured Nigerians that the new policy would eliminate the issue of cash shortages at ATMs while also enabling banks to recover operational costs.
Improved Cash Availability
Onojah emphasized that the primary objective of the policy is to ensure customers always have access to cash at ATMs.
“We have gotten the commitment of the banks to ensure that you don’t go to the ATMs and be told that there is no money. We have ensured that when you get to the bank, at least we have set a minimum of N20,000 that you can withdraw at your own wish,” he stated.
Additionally, he highlighted the extension of ATM services to remote locations, ensuring that customers in underserved areas also have consistent access to cash.
Supporting Banks’ Cost Recovery
According to Onojah, deploying ATMs is a significant financial investment for banks, and the new policy is designed to support cost recovery efforts.
“The third one is to say that even in remote locations, you will have machines that are there, not on the bank premises. Then on the side of the banks, deploying machines are quite expensive, they are capital intensive, I wouldn’t tell you how much it costs a bank to deploy just one machine.
“And so, we need to be able to encourage them to at least do what we call cost recovery. It is a balanced circular that came out. While we look at the side of the bank, at least they should be able to recover their cost, we also want to ensure that the consumer, the customer to the bank at any point in time have access to cash.”
He further clarified that these charges apply exclusively to withdrawals made from ATMs of banks other than where an account is held. Withdrawals from a customer’s own bank’s ATM remain free of charge.
New Charges and Implementation Timeline
The CBN had earlier issued a circular on Tuesday notifying all banks and financial institutions of the revised ATM withdrawal charges. Effective March 1, 2025, customers using another bank’s ATM for withdrawals will incur a charge of ₦100 for every ₦20,000 withdrawn. The previous provision allowing three free withdrawals per month from other banks’ ATMs has been discontinued.
For ATMs located outside banking premises, such as those at shopping malls, restaurants, and other public areas, an additional surcharge of up to ₦500 per ₦20,000 withdrawn will be applied alongside the statutory ₦100 fee.
While the policy has generated mixed reactions, the CBN maintains that it strikes a balance between ensuring consumer convenience and allowing banks to sustain their ATM services efficiently.
