Bank customers kick as CBN scraps free ATM withdrawals
Some bank customers have kicked against the decision of the Central Bank of Nigeria to scrap the free withdrawals on other banks’ Automated Teller Machines and the introduction of N100 for withdrawals of N20,000.
They expressed their reservations on Tuesday following the release of the CBN circular, which was signed by the Acting Director of the Financial Policy and Regulation department, John Onojah.
According to the circular titled ‘Review of Automated Teller Machine Transaction Fees,’ the CBN has eliminated the three free monthly withdrawals previously allowed for customers using other banks’ ATMs.
It read, “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.”
Under the new directive, withdrawals made from a customer’s bank ATM will remain free. However, customers using another bank’s ATM will now be charged N100 per N20,000 withdrawal when using ATMs located within bank premises. For withdrawals made at off-site ATMs, a charge of N100 per N20,000 withdrawal will apply, along with a surcharge of up to N500. The surcharge, which will be an income of the ATM deployer or acquirer, must be disclosed at the point of withdrawal.
The CBN also stated that international ATM withdrawals would be charged at the exact rate set by the international acquirer. The apex bank attributed the review to rising costs and the need to enhance ATM operations’ efficiency.
The circular read, “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 transaction 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.”
Following the circular, the Chairman of the Bank Customers Association of Nigeria, Dr. Uju Ogubunka, in a chat with The PUNCH, said the increase wasn’t such a bad idea given the state of the economy but expressed concerns about the rate of increase.
He said, “It should have been expected. Other places have increased their fees. The only thing one can talk about is the extent of the increase. Electricity, telephones, and even the open market have recorded increases in prices. The issue should not be the increase but the extent of it. Is it reasonable? Is it affordable at this point in time?
“It is not only banking services that are increasing fees. If you ask me, I will say let’s move on. Someday, these things will adjust themselves.”
However, a financial analyst, Segun Aremu, said this move would negatively impact the financial inclusion campaign of the CBN.
He said, “In Nigeria, there are still a lot of people unbanked; this is more like a discouragement. We are looking at the masses, who have N10,000 and N20,000, who are going to be mostly affected. If you are in an area where there’s only one bank, you have to bear that extra cost. What we should be getting now is cheaper costs, not expensive costs of transaction.
“This will bring more to banks, and more people will be forced to use electronic banking. I think they want to reduce dependency on cash as well, but at this point in the economy, people still need cash. We have not transitioned to mobile banking and such. We are getting there, but I feel like this is coming too early. The intentions may be good, but before March 1, when they will implement it, I hope we will see an improvement. Anyway, Nigerians are very adaptable.”
A user on the social media platform X, Oladele Olowookere, in his comments, wrote, “With the new ATM withdrawal charges aiming to take place on 1st March 2025, it is obvious FGN and CBN want to cripple every middle-level or low-level income earner to paupers. These charges will cripple people’s account balances like crazy. #20,000 na #550 charges.”
Another user, Evuakpo Afoke, lamented, “This government is really taking Nigerians for granted. After stamp duty, they are now increasing the charges on ATM withdrawals. So, they benefit when my money is deposited in my account and want more when I withdraw it. All the while, they want cashless transactions.”
Mega Mixer, expressing bewilderment, stated, “How do banks in countries where their customers don’t have to pay through their noses to withdraw or transfer their own money make a profit and are still able to offer better services than all Nigerian banks combined?”
Another user, Sunday Truck, said, “New fees for ATM transactions? That’s going to be frustrating for a lot of people.”
