The Central Bank of Nigeria (CBN) has defended its newly introduced policy imposing charges on cash withdrawals from Automated Teller Machines (ATMs) belonging to banks other than those of the customers. The policy, according to the CBN, is designed to benefit both banks and customers.
John Onojah, Acting Director of the Financial Policy and Regulation Department at the CBN, shared this during an appearance on Channels Television’s Sunrise program on Saturday.
Onojah explained that the policy aims to address persistent complaints about cash shortages at bank ATMs. He noted that it would not only improve cash availability for customers but also enable banks to recover associated operational costs.
“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,” Onojah said.
“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 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.”
Onojah reiterated that the charges are only for withdrawal from other banks ATMs, adding that there are no costs for customers any time they withdraw money from ATMs owned by financial institutions that they bank with.
The CBN in a circular on Tuesday to all banks and financial institutions announced that customers withdrawing from the ATM of other banks would now be charged ₦100 per every ₦20,000.
“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,” the circular partly read.
The Central Bank of Nigeria (CBN) has issued a directive for banks and other financial institutions to implement new charges effective March 1, 2025.
Under the new policy, off-site ATMs—those located outside bank premises, such as in shopping malls, eateries, and other public spaces—will attract a surcharge of up to ₦500 for every ₦20,000 withdrawn by customers using ATMs of banks other than their own. This is in addition to the standard ₦100 statutory fee already in place for such withdrawals.