CBN’s New ATM Fees Spark Concerns Over Financial Inclusion and Regulatory Oversight

The Changing Face of ATM Charges in Nigeria

For over a decade, the Central Bank of Nigeria (CBN) has played a central role in shaping Nigeria’s financial ecosystem, introducing policies aimed at financial inclusion and electronic payment adoption. However, the latest review of ATM charges, set to take effect on March 1, 2025, raises fresh concerns about the cost of banking services and regulatory oversight.

The new policy introduces a ₦100 fee per ₦20,000 withdrawal at on-site ATMs (inside bank premises) and an off-site charge of ₦100 plus a surcharge of up to ₦500 per ₦20,000 withdrawal at non-bank premises. This marks a significant shift from previous policies, where ATM withdrawal fees were reduced in 2019 to encourage financial accessibility.

The Policy Shift: Who Benefits?

While the CBN justifies the fee hike as a response to rising operational costs and the need for improved efficiency, critics question the timing and impact on consumers. The Federal Competition and Consumer Protection Commission (FCCPC), known for its swift intervention against private-sector price hikes, has remained silent on this policy shift. If private companies increased their fees at this scale, the FCCPC would likely be quick to act.

Additionally, the absence of any commitment from the CBN to fund ATM infrastructure raises further questions. Should banks and financial institutions bear the full burden of maintenance, or does the regulator have a role in subsidizing these costs?

A Look Back: The Evolution of ATM Charges

ATM fees in Nigeria have undergone multiple revisions over the years. In 2012, a ₦100 fee per withdrawal on other banks’ ATMs (off-us transactions) was introduced but later removed in 2013 to encourage cashless transactions. In 2019, the CBN further reduced ATM withdrawal fees from ₦65 to ₦35 after the third withdrawal within a month. These moves were seen as efforts to promote electronic banking and reduce reliance on cash.

However, with the latest adjustment, the free on-us withdrawal at a customer’s own bank remains intact, but this does little to cushion the impact on those relying on interbank transactions. Many Nigerians use off-site ATMs due to the limited availability of on-premises machines, meaning they will bear the brunt of the new charges.

The Bigger Picture: Financial Inclusion or Exclusion?

By raising ATM withdrawal costs, the CBN risks discouraging cash transactions and pushing customers toward alternative banking channels. While this aligns with the broader cashless policy, it may disproportionately affect those in rural areas or cash-dependent businesses.

As March 2025 approaches, Nigerians must brace for a new financial reality. Will these charges drive efficiency as promised, or will they deepen concerns about affordability and access? The coming months will determine whether this is a necessary adjustment or another burden on the average consumer.

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