- Nigeria banks begin N100, N500 charges on ATM as CBN introduces new charges on ATM withdrawal channels
- Nigerians react to the new charges, adjust banking habits as NASS, others call for its suspension
- CBN, banks remain adamant as Nigerians groan over new, other bank charges
This is indeed not the best of time for the bank customers across Nigeria as the banking regulatory body, Central Bank of Nigeria, CBN has continued to roll out one charge after another against ATM and electronic channels users.
WITHIN NIGERIA checks revealed that these charges have continued to to dot all areas of withdrawal channels in the banking industry.
Recall that on February 10, 2025, the Central Bank of Nigeria announced a significant revision to Automated Teller Machine withdrawal charges, set to take effect from 1 March 2025.
Our reporter gathered that in its circular, reflecting the same date, the apex bank directed all banks and financial institutions to implement new ATM withdrawal charges from 1 March 2025.
Findings showed that the effect of the said charges is that customers will now pay for every withdrawal made from another bank’s ATM.
The review affects the charges prescribed in Section 10.7 of the CBN Guide to Charges by Banks, Other Financial, and Non-Bank Financial Institutions (2020).
The circular which was signed by John Onojah, Acting Director of the Financial Policy and Regulation Department at the CBN, is expected to accelerate the deployment of ATMs across the country while ensuring that financial institutions apply appropriate charges for the service.
Part of the circular reads thus, “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.
“In other words, ATM transactions will incur a base fee of N100 per transaction. It is also important to note that a tiered fee structure will apply for transactions exceeding N20,000, with an additional N100 charged for each subsequent withdrawal of N20,000 or a portion thereof.”
Customers withdrawing more than N20,000 from another bank’s ATM will be charged an additional N100 for every subsequent N20,000 or portion thereof, the document stated.
Another significant change in the revised structure is the removal of the three free monthly withdrawals previously allowed for customers using other banks’ ATMs.
From 1 March 2025, all withdrawals at another bank’s ATM will attract charges, potentially increasing costs for customers who frequently use ATMs outside their mother bank.
The apex bank clarified that financial institutions are not permitted to charge more than the prescribed fees, although banks may reduce charges depending on their business strategy.
Any bank found violating the directive, including compelling customers to withdraw less than N20,000 per transaction despite sufficient funds in their account, will be sanctioned accordingly.
Customers who experience such restrictions are encouraged to report complaints to the CBN Consumer Protection Department via cpd@cbn.gov.ng.
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 CBN further attributed the review to rising costs and the need to enhance efficiency in ATM operations.
The circular also read, “In response to rising costs and the need to improve the efficiency of Automated Teller Machine 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 1 March 2025.”
Our investigation showed that the new charges mean that bank customers who frequently use ATMs belonging to other banks will now incur higher costs.
However, the it was gathered that with the introduction of additional surcharges on off-site ATMs, this could also lead to increased reliance on digital banking channels such as mobile apps and online transfers.
As the banks across the country have started to implement the new structure from 1 March, customers have also adjusted their banking habits to avoid additional fees.
Findings by our reporter when he visited some ATM terminals in Enugu state showed that there seemed to be some shift in banking habits by these banks customers.
At First bank Nsukka, Enugu state, almost all the customers who came to make withdrawals are First bank customers. Only about two were from other banks.
Also at Ecobank, Nsukka none of the customers have ATM cards from another banks.
Recall that the CBN’s directive aligns with ongoing efforts to promote cashless transactions, a policy that has seen increased regulatory attention in recent years.
WITHIN NIGERIA gathered that this review of ATM charges followed a recent warning from the CBN that any bank found not dispensing cash via ATMs would be sanctioned.
Our checks showed that The CBN recently sanctioned nine Deposit Money Banks with fines totalling N1.35bn for failing to ensure cash availability via ATMs during the festive season.
Each of the banks was fined N150m following spot checks that revealed non-compliance with the apex bank’s cash distribution guidelines.
The affected banks included Fidelity Bank Plc, First Bank Plc, Keystone Bank Plc, Union Bank Plc, Globus Bank Plc, Providus Bank Plc, Zenith Bank Plc, United Bank for Africa Plc, and Sterling Bank Plc.
The fines, WITHIN NIGERIA gathered, would be directly debited from the banks’ accounts with the CBN.
This policy change has sparked widespread discussion due to its potential impact on consumers and the broader Nigerian economy. N100 charge for withdrawals below N20,000
The recent introduction of additional ATM withdrawal fees by the CBN has sparked widespread frustration, as many are already burdened with multiple banking charges.
For many, these deductions are not just figures on a bank statement but represent a significant strain on their finances.
Reactions trail the new ATM charge
As Nigerians continued to react to the new development, the former senator representing Kaduna Central, Shehu Sani, has condemned the scrapping of free ATM withdrawals for customers using other banks’ ATMs.
Reacting in an X post on Thursday, Sani said the hike in ATM charges could push Nigerians back to physically cashing cheques in banks.
He wrote, “If the CBN continues to increase ATM charges, people will return to the era of physically entering the bank to cash their cheques.”
Businesses, workers struggle
Small businesses, which rely heavily on cash transactions, are also struggling to adapt.
“We encourage our customers to pay via transfer, but not everyone is comfortable with that,” said Aisha Bello, a supermarket owner in Abuja.
“Now, with these fees, more customers are withdrawing less cash, which means they hesitate to buy more than they need. It is affecting our daily sales.”
Commercial drivers, who predominantly operate in cash, also feel the weight of these deductions.
Joseph Ali, a bus driver at the University of Nigeria, Nsukka campus told our reporter that the new ATM Card charge is a big financial burden on the citizens. According to him “I withdraw money daily to buy fuel and settle my family. If I withdraw N10,000 and am charged N100 in addition to N500, that’s money I could have used to buy extra fuel. These charges are killing small workers like us.”
Our reporter visits POS Operators
Some of the Point of Sale, POS operators visited by our reporter equally lamented the increasing charges by the Central Bank of Nigeria.
According to one of them who gave her name as Chinenye in Enugu state, “the charges are driving out customers from us. Today, we are no longer talking about cash scarcity. There is enough cash to give to our customers but the problem now is that many of our customers choose to make transfers instead of coming to collect cash. This is hugely because of charges associated with cash withdrawal.”
Analysts call for review
Financial analysts and economists have weighed in on the impact of these charges on individuals and the economy.
A development economist and financial expert, Francis Adebayo, criticised the banking system for overburdening Nigerians.
“The CBN needs to review these policies. It is becoming unbearable. The apex bank knows that most of these ATMs do not have cash. They know. One may need to depend on the ATMs of other banks.
“While financial institutions need to generate revenue, excessive deductions discourage financial inclusion. Many Nigerians will opt to keep their money in cash rather than deposit it in banks, which contradicts the goal of a cashless economy.”
Similarly, banking expert Uche Ezeh called for a revision of the charges.
“The increase in transaction costs could push more people towards informal financial services, such as cash savings and non-regulated financial institutions.
The government needs to find a balance between encouraging digital banking and ensuring that people are not discouraged from using formal financial services due to high costs.”
With the rising cost of living, many Nigerians hope the government and banking sector will reconsider these charges.
Multiplicity of bank charges in Nigeria
WITHIN NIGERIA investigations showed that Nigerians have about fifteen charges to incur as bank customers.
Some of these charges include; SMS Alert Fees, Stamp Duty, Transfer Fees, POS Transfer Fees, ATM Transfer Fees, COT, VAT, Foreign Exchange Commission Fees, Online Transfer Fees, SWIFT Transfer Fees, Remita (RRR) Charges, Inter Bank Transfer Fees, Card Maintenance Fees, Card Issue Fees, VAT on SMS, Outflow/Inflow Charges, USSD Charges, Cheque Issuance Fees, and now Cyber Security Levy.
SMS Alert Fees: There is usually a short message service (SMS) alert fee to the tune of 4 naira for every notification you receive on your phone for the purpose of consuming a banking transaction over the web.
Stamp Duty: There is an accompanying stamp duty charge of 50 naira for every transaction of 10,000 naira and above.
Transfer fees: This is the fee charged for processing transfers on the part of banks on behalf of their customers. No doubt, this varies depending on the bank concerned, the amount being transferred, and the mode of the transfer used by the bank customer.
POS Transfer Fees: Bank customers also suffer from point of sale (POS) charges when transacting banking businesses via POS machines for online businesses.
ATM Transfer Fees: Customers are meant to be subjected to the automated teller machines (ATM) fees, especially when you use your bank cards on other banks’ machines after third withdrawals on a monthly basis or when you use the ATM machines to effect online payments or for the settlement of bills.
Commission on Turnover (COT): Charges ranging from 0.1 percent to 0.5 percent are being applied during online transfers, which are being borne by the same bank customer as commission on turnover (COT).
Value Added Tax (VAT): VAT is being applied at the rate of 7.5 percent of the transfer fee by banks or financial institutions, as the case may be.
Foreign Exchange Commission fees: This is being applied for converting currencies on international transfers between two or more bank customers.
Online transfer fees: Banks oftentimes charge what is known as an online transfer fee, especially for all manner of international business transactions.
Swift Transfer Fees: This is a fee charged for international transfers using the SWIFT network or platform.
Remittance Retrieval Reference (RRR) Charges: Banks also subject their customers to RRR charges especially when using their platform to affect our wards’ school fees.
Interbank Transfer Fees: This is primarily applicable when effecting transfers between banks.
Card Maintenance Fee: There is always a monthly card maintenance fee that banks subject their customers to regularly for the singular purpose of using their debit cards or other forms of cards.
Card issuance fee: This is applicable when a bank customer is being issued a new debit card or when an expired one is being renewed.
VAT on SMS: Bank customers are oftentimes subjected to a value-added tax (VAT) on short message services( SMS) received from their bankers.
Outflow/Inflow: The list is also not endless without reference to the issue of outflow/inflow charges that customers are meant to bear when funds either go out or come into the customer’s bank account.
USSD charges: There are unstructured supplementary service data (USSD) charges to the tune of 6.98 naira for online transfers to be borne once again by bank customers. It is imperative to state further that this particular charge also varies from bank to bank.
Cheque Issuance Fees: Banks charge their customers a check issuance fee whenever a new check booklet is issued to their customers.
Cyber Security Levy: The Central Bank of Nigeria (CBN) recently directed aLL banks to impose a 0.5 percent cybersecurity levy on some selected bank transactions.
To this end, funds are to be remitted directly to the office of the National Security Adviser (NSA).
NASS moves to suspend the new ATM charge
As Nigerians continued to wriggle and writhed in the new ATM card charge the House of Representatives on Tuesday asked the Central Bank of Nigeria (CBN) to immediately suspend the increase of Automated Teller Machine (ATM) transaction charges and stoppage of free ATM withdrawals for customers from other banks in the country.
This followed the adoption of a motion on matters of urgent national importance moved by the member representing Essan Central/Essan West/Igueben federal constituency of Edo State, Hon. Marcus Onobun, at plenary yesterday.
Moving the motion, Onobun said the apex bank in its new circular reviewed the ATM transaction fees stipulated under section 10.7 of the “CBN Guide to Charges by Banks, Other Financial and Non-Bank Financial Institutions”, prescribing an increase in the machine withdrawal charges and a discontinuation of the free ATM withdrawals for customers using other banks’ teller machines, thereby imposing additional financial burdens on Nigerians.
According to the lawmaker, the said section 10.7 of this Guide was last reviewed in 2019, reducing ATM transaction fees from N65 to N35 per transaction.
He noted that with the new policy, customers withdrawing from their Bank’s ATMs will continue to enjoy free withdrawals but a fee of N100 per N20,000 withdrawals will be applied to customers from other Banks transacting from ATMs within the Bank premises.
“Similarly, Customers from other Banks transacting from ATM outside the premises of the Bank (Malls, Market places, and other public places) will be charged N100 and an additional surcharge of N500,” Onobun said.
He expressed worry that citizens of Nigeria were already grappling with multiple economic hardships, including high inflation, increased fuel prices, electricity tariff hike, and numerous banking and service charges that significantly reduce disposable income and negatively impact the economic welfare of citizens.
“Worried that the imposition of additional ATM withdrawal charges will further limit the financial inclusion of Nigerians by discouraging low-income earners from accessing banking services, thereby contradicting the CBN’s financial inclusion agenda.
“Cognizant of the fact that the banking sector has continued to record significant profits, imposing further charges on consumers without corresponding improvements in service delivery or infrastructure is unjustifiable; Note that the role of government includes protecting citizens from exploitative financial practices that may lead to further economic distress,” he argued.
When the House adopted the motion, it reiterated the call on CBN to immediately suspend the implementation of the policy, pending proper engagement with its relevant committees.
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