CBN: New ATM withdrawal policy to benefit both Banks, customers

The Central Bank of Nigeria (CBN) has reiterated that its new ATM withdrawal policy, set to take effect on March 1, will bring significant benefits to both banks and their customers.

According to the apex bank, the move aims to address cash shortages, improve service efficiency, and ensure cost recovery for financial institutions.

The policy stipulates that customers withdrawing cash from ATMs of banks other than their own will be charged N100 for every N20,000 transaction.

Speaking on Channels Television’s Sunrise programme, the CBN’s Acting Director of Financial Policy and Regulation Department, John Onojah, emphasized that the policy will enhance ATM service availability and alleviates cash shortages.

“We have secured commitments from banks to ensure that ATMs are consistently stocked with cash,” Onojah said. “With a set minimum of N20,000 per withdrawal, customers will experience fewer disruptions and enjoy a more seamless banking experience.”

Onojah also highlighted that deploying ATMs is a costly endeavor for banks, necessitating the need for a cost-recovery mechanism.

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“ATMs require significant capital investments and maintenance. This policy helps banks recover those costs while ensuring customers have uninterrupted access to cash,” he explained.

Financial analysts have weighed in on the policy, offering varying perspectives.

Dr. Michael Adewale, an economist at Lagos Business School, believes the directive is a pragmatic step for sustainable banking.

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“While some may view the charge as an additional expense, it ultimately contributes to more reliable ATM services. If implemented effectively, customers should see improved cash availability,” Adewale stated.

On the other hand, consumer rights advocate Mrs. Aisha Yusuf raised concerns about the potential financial burden on customers.

“Nigerians already grapple with multiple banking fees. Introducing another charge could discourage cash transactions and increase financial strain, particularly for low-income earners,” she said.

Some bank customers have expressed mixed feelings about the policy. While many welcome the promise of improved ATM cash availability, others worry about the added charges.

David Chukwu, a trader in Abuja, remarked, “If this means I won’t have to struggle to find a working ATM, then it’s a good move. But banks must ensure the machines are always stocked.”

However, Lagos-based civil servant Funmi Adebayo disagreed. “N100 per withdrawal might not seem like much, but it accumulates over time. Banks should focus on reducing fees rather than introducing new ones,” she argued.

With the CBN’s ongoing push for a cashless economy, analysts suggest that this policy may encourage more customers to shift towards digital banking solutions, such as mobile transfers and online payments.

As the March 1 implementation date approaches, banks and customers alike will be keenly watching to see how well the policy delivers on its promises of improved ATM service and enhanced banking efficiency.