Economist Dr. Augustine Kutu has suggested the Central Bank of Nigeria (CBN) and policymakers to handle the considerations of Nigerians concerning the brand new expenses on Automated Teller Machine (ATM) transactions.
Below the revised charge construction, which took impact on March 1, 2025, industrial banks at the moment are charging clients N100 per N20,000 withdrawal from on-site ATMs and N600 for off-site ATM withdrawals.
The CBN issued a round on February 10, 2025, to all banks and monetary establishments, saying the overview of ATM transaction charges. In response to the brand new tips, withdrawals from one’s personal bank ATMs will stay freed from cost.
Nevertheless, clients withdrawing N20,000 or much less from one other bank’s ATM will incur a N100 charge per transaction. The CBN cited rising prices and the necessity to enhance the effectivity of ATM companies within the banking trade as causes for the brand new expenses.
Residents specific concern
Dr. Kutu, an Assistant Professor on the College of Western Ontario-Canada, famous that whereas residents have expressed considerations that the coverage reduces their buying energy, imposes a monetary burden, and discourages financial savings, banks argue that the costs are essential to offset their operational bills and stimulate the financial system.
“As a part of the financial coverage framework, the CBN regulates bank expenses and deductions, together with these associated to money transactions and account upkeep. These expenses range throughout banks and rely upon the precise kind of transaction.”
In response to the Central Bank of Nigeria (CBN), the reintroduction of expenses on sure money deposits and withdrawals is to advertise a contemporary and environment friendly fee system. “It goals to scale back the nation’s reliance on money transactions, which could be expensive and hinder financial improvement,” stated Dr. Kutu.
Dr. Kutu emphasised that the coverage would possible discourage extreme money dealing with, reduce operational prices, and encourage Nigerians to undertake different fee strategies, equivalent to digital transactions. Nevertheless, he acknowledged that the nation’s present financial local weather poses important challenges to the coverage’s effectiveness.
“Paramount amongst these challenges are safety considerations, as digital fee methods are susceptible to cyber threats and information breaches. Moreover, unreliable infrastructure, together with restricted entry to the web and energy, hinders the widespread adoption of digital fee strategies.
“The low digital literacy, significantly in rural areas, and the latest approval of a fifty % hike in telecom tariffs could proceed to discourage Nigerians from embracing the brand new coverage. To make sure the profitable implementation and adoption of the coverage, policymakers should first deal with urgent customer considerations, together with the regular enhance in telecom tariffs, cybercrime fears, and technical points,” Dr. Kutu stated.
What it’s best to know
- He additionally suggested the CBN to think about different measures, equivalent to implementing a downward overview of ATM and Level of Gross sales (POS) transaction service charges, in addition to interbank expenses, to lower monetary burdens on clients.
- “There also needs to be elevated entry to ATMs and POS terminals, significantly in rural areas, to advertise monetary inclusion,” he stated.
Dr. Kutu additional urged the event of Data and Communication Know-how (ICT) infrastructure in rural areas to bridge the digital divide and facilitate entry to digital monetary companies.
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