The Central Bank of Nigeria (CBN) has announced the removal of the three free monthly withdrawals on Automated Teller Machines (ATMs) of other banks, a policy shift that will increase the cost of cash withdrawals for bank customers nationwide.
In a circular dated February 10, 2025, the CBN directed all financial institutions to implement the revised charges starting from March 1, 2025. Under the new regulation, customers will now be charged for every withdrawal made from another bank’s ATM, ending the previous practice of allowing three free transactions per month.
According to the directive, withdrawals made from an ATM belonging to a customer’s bank will remain free. However, customers withdrawing cash from another bank’s ATM will now incur a charge of ₦100 per ₦20,000 transaction when using ATMs located within bank premises. For withdrawals at off-site ATMs—those not located within a bank—the charge remains ₦100 per ₦20,000, but with an additional surcharge of up to ₦500, payable to the ATM deployer or acquirer. This surcharge must be disclosed at the point of withdrawal.
CBN’s Justification for the New Charges
The CBN stated that the adjustment was necessary due to rising operational costs and the need to improve the efficiency of ATM services in Nigeria. The apex bank explained that the changes would accelerate the deployment of more ATMs across the country while ensuring that financial institutions apply appropriate charges for the service.
The circular, signed by John Onojah, Acting Director of the Financial Policy and Regulation Department, read:
“The three free monthly withdrawals allowed for Remote-On-Us transactions (other bank ATMs) in Nigeria under Section 10.6.2 of the Guide shall no longer apply.”
Furthermore, international ATM withdrawals will be charged at the exact rate set by the international acquirer, making cross-border transactions potentially more expensive for Nigerian travelers.
Impact on Bank Customers
The new directive means that customers who frequently use ATMs of other banks will now have to pay higher fees. The additional surcharge on off-site ATMs could also discourage cash withdrawals and push more customers toward digital banking channels, such as mobile apps and online transfers, in line with the CBN’s push for a cashless economy.
With the implementation set for March 1, 2025, customers may need to adjust their banking habits to avoid additional fees, such as withdrawing larger sums at once or relying more on their own bank’s ATMs.
CBN’s Recent Crackdown on Banks Over ATM Cash Shortages
This review of ATM charges comes after the CBN sanctioned nine commercial banks for failing to ensure adequate cash availability at ATMs during the last festive season. The apex bank imposed a ₦1.35 billion fine, debiting ₦150 million from each bank’s account for non-compliance with 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 (UBA) Plc
- Sterling Bank Plc
The CBN has vowed to enforce strict compliance with ATM cash availability policies to prevent future cash shortages and ensure improved service delivery.