The Central Bank of Nigeria (CBN) has issued a warning to banks against limiting Automated Teller Machine (ATM) withdrawals to less than N20,000 per transaction, stating that any bank found violating this directive will face sanctions.
This announcement was made in a document addressing public concerns over the revised ATM withdrawal charges.
Earlier, the CBN announced an adjustment in ATM withdrawal fees, set to take effect from March 1.
According to the new policy, customers will be charged N100 for every N20,000 withdrawal made from an on-site ATM of another bank.
In a circular issued to financial institutions, the CBN clarified that withdrawals from a customer’s own bank’s ATM (On-Us transactions) will remain free of charge. However, when customers withdraw from another bank’s ATM (Not-On-Us transactions), they will be charged N100 per N20,000 withdrawal at on-site ATMs within bank premises. For off-site ATMs located outside bank premises, the withdrawal fee will be N100 plus an additional surcharge of up to N500 per N20,000 transaction.
The CBN explained that this surcharge is an income for the ATM deployer or acquirer and must be disclosed to consumers at the point of withdrawal. International withdrawals made using debit or credit cards will be charged based on the exact cost imposed by the international acquirer. The CBN also announced the removal of the previous policy allowing three free withdrawals per month from other banks’ ATMs.
In response to growing concerns over withdrawal limits, the CBN released a Frequently Asked Questions (FAQ) document to clarify how the new charges will be implemented. The apex bank emphasized that banks must permit customers to withdraw up to N20,000 per transaction.
The apex bank warned that any bank that forces customers to withdraw less than this amount—despite having sufficient funds—will be considered in violation of the regulation and will face penalties. Customers who experience such restrictions are encouraged to file complaints with the CBN via cpd@cbn.gov.ng.
The CBN also reiterated that banks cannot charge more than the prescribed withdrawal fees, although they have the flexibility to charge lower amounts based on their operational costs. The regulator stressed that the fees and surcharges are capped, ensuring that financial institutions do not exceed the approved limits. However, banks may opt to offer lower charges depending on their cost structure and business strategy.
To avoid unnecessary ATM fees, the CBN advised customers to withdraw cash from their own bank’s ATMs, where transactions remain free. It also recommended minimizing withdrawals from off-site ATMs to avoid additional surcharges.
Furthermore, consumers are encouraged to explore alternative cashless payment methods, such as mobile banking apps and POS transactions, to reduce dependence on ATM withdrawals.
