The Cloud Network Foundation (CNF) has flayed the Central Bank of Nigeria’s (CBN) recently announced ATM transaction fees, expressing concern that the policy will further increase the financial strain on ordinary Nigerians already grappling with rising costs of living.
The CBN’s new directive introduces several changes to ATM transaction fees. Most notably, the previous policy allowing customers three free monthly withdrawals from other banks’ ATMs has been eliminated.
This means that every withdrawal from an ATM operated by a bank other than their own will now incur a charge. Specifically, customers will be charged N100 for every N20,000 withdrawn from another bank’s ATM. Even using another bank’s ATM within its premises will attract the same fee.
Instead of burdening consumers with additional costs, the CNF suggests the government focus on improving the business environment. They argue that reducing regulatory red tape and addressing operational challenges faced by service providers would allow businesses to remain profitable without passing on costs to citizens.
CNF: CBN’s ATM fees will add pressure on Nigerians
Furthermore, withdrawals from off-site ATMs (those located outside bank premises) may also be subjected to an additional surcharge of up to N500. The CBN stated that this surcharge will be retained by the ATM deployer/acquirer and must be disclosed to consumers at the point of withdrawal. International ATM withdrawals will also attract charges at rates set by the international operators.
The CBN has justified the new charges by citing increasing operational costs and the need to improve ATM service efficiency. The regulator expects the adjustments to encourage greater deployment of ATMs across Nigeria while ensuring that financial institutions appropriately charge customers for the service.
Mr. Abimbola Tooki, Chairman of the Cloud Network Foundation, has condemned the CBN’s policy. The CNF, which previously opposed the telecoms tariff increase, argues that the government should avoid policies that add to the financial pressure on Nigerians.
Instead of burdening consumers with additional costs, the CNF suggests the government focus on improving the business environment. They argue that reducing regulatory red tape and addressing operational challenges faced by service providers would allow businesses to remain profitable without passing on costs to citizens.
These new ATM fees come against a backdrop of economic hardship in Nigeria. In recent years, the nation has experienced rising inflation, fluctuating oil prices, and the effects of global economic downturns. These challenges have led to increased prices for essential goods and services, placing significant strain on the average Nigerian household.
The CNF argues that these new ATM charges come at a time when Nigerians are already struggling with a high cost of living, exacerbated by earlier increases in petrol and electricity prices, as well as the recent 50% tariff increase for telecom services. They further add that despite industry operators often justifying price hikes with promises of better service delivery, many Nigerians do not feel they are getting value for money.
Moreover, despite the additional revenue generated from these increases, the federal government has not provided substantial improvements in infrastructure or public services that justify these extra costs imposed on citizens.
For years, Nigeria has focused on financial inclusion. Many people fear that this new CBN policy may have an adverse effect on that effort. To improve the economy and grow the GDP, more people need to be financially included in a transparent and trustworthy manner. Adding more fees could send a signal that makes it harder for those not financially included to participate in the sector.
The CNF is urging the government to prioritize policies that ease the cost of doing business and improve citizens’ purchasing power. The organisation is calling for measures to stabilize the economy and avoid further price increases in essential services.
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