CBN Warns Banks Against Limiting ATM Withdrawals
By Patience Ikpeme
The Central Bank of Nigeria (CBN) has issued a stern warning to commercial banks against forcing customers to withdraw less than N20,000 per transaction from Automated Teller Machines (ATMs) when sufficient funds are available.
The apex bank emphasized that such practices are a violation of its regulations and will attract sanctions.
This warning was contained in a Q&A explainer released by the CBN following a recent review of ATM withdrawal fees. The CBN clarified that the established ATM charges for withdrawals from other banks’ ATMs – whether on-site or off-site – are predicated on the understanding that customers should be able to withdraw up to 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 CBN stated emphatically.
The apex bank urged customers who experience such limitations to report the offending 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,” the statement advised.
The CBN also addressed the issue of ATM charges, clarifying that while banks cannot exceed the prescribed fees, they are permitted to charge less. “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 CBN explained. This allows banks some flexibility based on their operational costs and competitive strategies.
In a move aimed at minimizing costs for consumers, the CBN encouraged customers to utilize ATMs belonging to their own banks whenever possible, as this typically avoids inter-bank transaction charges.
Furthermore, the CBN promoted the adoption of alternative payment methods, such as mobile banking applications, Point of Sale (POS) terminals, and other digital payment platforms. The use of these digital channels, the CBN noted, can significantly reduce reliance on cash withdrawals and consequently, the associated ATM fees.
The CBN’s latest pronouncement underscores its commitment to protecting the rights of bank customers and ensuring the smooth and efficient operation of the nation’s payment systems.
The apex bank’s proactive approach to addressing potential issues related to ATM usage is expected to foster greater transparency and accountability within the banking sector. The CBN has made it clear that it will not hesitate to enforce its regulations and penalize banks that engage in practices that disadvantage customers.
This move is also expected to further drive the adoption of digital payment solutions, aligning with the CBN’s broader cashless economy agenda.
