CBN to sanction banks forcing customers to withdraw below N20,000 at ATMs

The Central Bank of Nigeria (CBN) has threatened to sanction commercial banks that force customers to withdraw below N20,000 per transaction from Automated Teller Machines (ATMs) despite having higher funds. 

While highlighting the warning via a Q&A following its recent review of ATM withdrawal fees, the Nigerian apex bank stressed that ATM charges for withdrawals made from other banks’ ATMs are charged based on the fact that customers can withdraw N20,000 per transaction. 

“Any bank that compels a customer with sufficient funds in their account to withdraw less than N20,000 per transaction, against their desire for a higher sum, would be contravening this regulation and will be sanctioned appropriately,” the bank stated. 

CBN, however, notified customers affected by the unnecessary restrictions to file a complaint against such banks.

“Consumers denied the right to withdraw up to N20,000 per transaction are encouraged to file a complaint with the CBN using cpd@cbn.gov.ng.” it said.

On ATM withdrawal charge fees, the apex bank noted that commercial banks are not allowed to charge more than the specified fee. They can, however, choose to charge below the prescribed fee as it is related to their finance and cost structure. 

“The charges and surcharges are capped, meaning banks and other financial institutions cannot charge more than the fees stated in the circular. However, a bank can charge a lower amount depending on its cost structure and business development drive,” the apex bank said.

To avoid the course of extra charges and minimize ATM withdrawal fees, CBN advised customers to withdraw cash from their own bank’s ATMs and to also explore alternative payment options such as mobile banking apps, POS terminals, and other digital payment mediums. 

Also Read: CBN launches whistleblowing website, to go live on January 1, 2025.

CBN reviews ATM withdrawal fees

Amidst its call to commercial banks to effect a responsible play to customers, the apex bank introduced new ATM charges on Tuesday. The financial regulator disclosed the review in ATM charges is in response to rising costs of operation for banks and the need to improve the efficiency of ATM.

The CBN also announced the discontinuation of the three free withdrawals per month on ATM cards.

“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 (CBN) 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 CBN said.

As such, customers who are withdrawing at the ATMs of their own banks and financial institutions in Nigeria will not be required to pay any ATM charges. 

However, when withdrawing from another bank or financial institution’s ATM in Nigeria, if the withdrawal takes place on-site (within the bank’s premises) such a withdrawal would attract a charge of 100 naira for every 20,000 naira withdrawal.

But when the ATM is offsite (i.e located outside bank premises like at shopping malls, airports, grocery stores, or gas stations) such a withdrawal attracts the basic charge of 100 naira for 20,000 naira as well as a surcharge of not more than 500 naira per 20,000 naira withdrawal.

For international withdrawals using either a debit or credit card, they have to pay cost recovery which will be charged by the international acquirer.

Also in its recent policy to effect a transparent and credible operational framework across the Nigerian financial system, CBN unveiled its whistleblowing website.

The apex bank stated that the platform was designed for individuals to engage in all forms of misconduct without fear or intimidation. 

The platform represents a significant step toward creating a safe environment for all and gives individuals such as employees, vendors, consultants, executives, and other stakeholders the swift ability to report personal and professional misconduct, unethical behaviour, or violations of the law.