For many Nigerians, withdrawing cash from any available ATM has been a convenient part of daily banking. But starting March 1, 2025, that convenience comes at a cost.
The Central Bank of Nigeria (CBN) has scrapped the long-standing policy that allowed customers to make three free withdrawals per month from other banks’ ATMs.
Now, every time a customer withdraws from an ATM that doesn’t belong to their bank, a charge will apply—N100 per N20,000 for on-site ATMs and up to N500 for off-site machines.
This policy shift, announced in a circular dated February 10, 2025, is part of what the CBN describes as an effort to “improve ATM efficiency” and “accelerate ATM deployment across the country.” But for everyday Nigerians, it means adjusting to a new reality where accessing their money just got more expensive.
The circular, 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.
It read, “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.
The circular read, “In response to rising costs and the need to improve efficiency of Automated Teller Machine (ATM) 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 March 1, 2025.”
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This change means one of two things: bank customers either find a way to stick to their bank’s ATMs or accept the extra charges as an unavoidable expense.
The CBN argues that rising costs and the need to make ATM operations more efficient justify the move. However, some financial analysts see it as part of the broader push toward a cashless economy, where digital transactions become the default mode of payments.
With the new policy:
- Withdrawing from your bank’s ATM? No charge.
- Withdrawing from another bank’s ATM? N100 per N20,000.
- Using an off-site ATM (not inside a bank)? An extra surcharge of up to N500 may apply.
- International ATM withdrawals? Charges will depend on the international acquirer’s rates.
With these new charges, banks are likely to nudge customers toward mobile apps, USSD codes, and online transfers. The message is clear: cash transactions are becoming more expensive, and digital banking is the future.
This move comes on the heels of the CBN’s recent crackdown on banks that failed to dispense cash at ATMs during the festive season. Nine banks, including First Bank, Fidelity Bank, and Zenith Bank, were fined N1.35 billion for failing to meet the regulator’s cash distribution guidelines.
For Nigerians, this policy change means being more strategic about where and how they withdraw money. More people may turn to POS agents, even though they, too, have their own service charges. Others may fully embrace digital payments to avoid ATM fees altogether.