Bank customers lament new ATM charges, say it negates financial inclusive drive

..As SERAP issues CBN 48hrs ultimatum to withdraw ‘unlawful hike’ in transaction charges

 

Bank customers have decried the upward review of Automated Teller Machine (ATM) transaction fees by the Central Bank of Nigeria (CBN).

Some of the customers who spoke to the News Agency of Nigeria (NAN) in Abuja on Sunday, said the new policy negated the financial inclusion and cashless policies of the CBN.

Mrs Catherine Itoha, a civil servant, said the tax would discourage the unbanked from getting into the financial inclusion net.

Itoha who observed that this method of tax generation was not obtainable in other climes, appealed to the CBN to devise other means of tax instead of discouraging banking.

”Is this how they want to encourage cashless policy? This is definitely not good.

”The tariff is too high. This is the reason why

if you go to most bush market, they do not accept transfer. The traders will tell you that they do not have bank accounts therefore, you pay so much to withdraw.

”The other day that I went to a bush market, I used N4000 to withdraw N90,000 in a Point of Sale (PoS) because they insisted on cash.

”The government should be thinking of how to bring people like those traders into the banking net and not chase them away with charges.

”It is the masses that are suffering all these charges,” she said.

Mr Davis Agede, a former banker, regretted that the CBN would bring a policy and another to clash with the previous one.

Agede alleged that with the ATM transaction fees increase, the PoS merchant would soon increase their fees.

Hajia Kudirat Aminu, a trader, said she now preferred to keep her monies in her home to run away from various bank charges.

Aminu said that although she barely used ATM for withdrawal, the new policy would further discourage some of her fellow traders who were small business owners.

”I go to the market everyday so I do not need to keep my money in the bank.

”This policy will discourage so many small business owners from using their bank accounts,” she said.

Another bank customer, Mr Kayode Are, regretted that all taxes had been reviewed upward in every sector.

”Does the government want to kill us with taxes?

”How will the poor masses survive this? he asked.

Miss Catherine Nnaji, a student and a bank customer, appealed to the CBN to reduce  transaction fees charged customers withdrawing from another bank’s ATM.

Nnaji said the appeal was due to the absence of her bank and its ATM within her place of residence.

”My bank is too far away from where I stay. I usually use other bank’s ATM to withdraw money.

”The CBN should pity us because we are students and do not currently have a means of making money,” she said.

NAN reports that the CBN had on Feb. 10, released a circular to all banks and other financial institutions to apply the increased charges with effect from March 1.

CBN in the circular with the title ‘Review of ATM transaction fees’ said the move was in response to rising cost and the need to improve the efficiency of ATM services in the banking industry.

”The CBN has reviewed the ATM transaction fees prescribed in Section 10.7 of the extant CBN Guide to charges by banks, other financial institutions 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 with effect from March 1, 2025,” the CBN said.

The CBN in the circular said that customers withdrawing at the ATM of their financial institutions would not be charged.

However, the Bank said that customers withdrawing from another institution’s ATM would be charged.

”On-Us (customers withdrawing at the ATM of the customer’s financial institution) in Nigeria, no charge.

”Not-on-Us ( withdrawal from another institution’s ATM) in Nigeria; On-site-ATMs: A charge of N100 per N20,000 withdrawal.

”Off-site ATMs: A charge of N100 plus a surcharge of not more than N500 per N20,000 withdrawal.

”The income which is an income of the ATM acquirer/deployer, shall be disclosed at point of withdrawal to the consumer,” CBN said.

..As SERAP issues CBN 48hrs ultimatum to withdraw ‘unlawful hike’ in transaction charges

However, Socio-Economic Rights and Accountability Project (SERAP) has urged the Governor of the Central Bank of Nigeria, CBN, Mr Olayemi Cardoso, to use his “leadership position to immediately withdraw the patently unlawful, unfair, unreasonable and unjust increase in Automated Teller Machine (ATM) transaction fees.”

SERAP urged him to “ensure that the exercise of CBN statutory powers and functions does not inflict misery on poor Nigerians and contribute to human rights abuses.”

The CBN recently announced that ATM withdrawals made at a machine owned by a bank but outside its branch premises will now attract a charge of N100 per N20,000 withdrawn. ATM withdrawals at shopping centres, airports or standalone cash points, will incur a N100 fee plus a surcharge of up to N500 per N20,000 withdrawal.

Banks ‘are advised to apply the increased ATM fees with effect from March 1, 2025.’

In the open letter dated 15 February 2025 and signed by SERAP deputy director Kolawole Oluwadare, the organisation said: “the manifestly unlawful, unfair, unreasonable, and unjust increase in ATM transaction fees will hit hardest those at the bottom of the economy and exacerbate the growing poverty in the country.”

SERAP said, “The increase in ATM transaction fees ought to have been shouldered by wealthy banks and their shareholders, not the general public. The increase only benefits the CBN and commercial banks at the expense of poor Nigerians.”

According to SERAP, “CBN policies should not be skewed against poor Nigerians and heavily in favour of banks that continue to declare trillions of naira in profits mostly at the expense of their customers. The increase in ATM transaction fees would inflict misery on poor Nigerians and contribute to human rights abuses.”

The letter, read in part: “The increase in ATM transaction fees is also entirely inconsistent with the oft-expressed commitment by the government of President Bola Tinubu to address the growing poverty across the country.”

“We would be grateful if the recommended measures are taken within 48 hours of the receipt and/or publication of this letter. If we have not heard from you by then, SERAP shall take all appropriate legal actions to compel you and the CBN to comply with our request in the public interest.”

“The exorbitant and unlawful increase in ATM transaction fees at a time the country is facing economic and financial crises would contribute further to the impoverishment of the population.”

“Imposing exorbitant ATM transaction fees on socially and economically vulnerable Nigerians at a time several Nigerian banks are declaring trillions of naira in profits yearly is manifestly unfair, unreasonable and unjust.”

“The increase cannot be justified under the Nigerian Constitution 1999 [as amended], the CBN Act, Federal Competition and Consumer Protection Act, and the country’s international human rights obligations.”

“The patently unlawful, unfair, unreasonable and unjust increase in ATM transaction fees also inherently contributes to violations of the human rights of socially and economically Nigerians.”

“The increase creates a two-tiered financial system that discriminates against poor Nigerians who may not be able to afford or pay the increased fees.”

“While the government of President Tinubu has primary responsibility for protecting the rights of Nigerians, the CBN also has the responsibilities to ensure that its practices and guidelines do not cause or contribute to human rights abuses.”

“The CBN could play an important role in promoting economic opportunities for Nigerians where the majority of the people live in poverty.”

“The CBN is failing to comply with the Nigerian Constitution, the Federal Competition and Consumer Protection Act and the country’s international human rights obligations in the exercise of its statutory powers and functions.”

“The CBN is also compromising its stated mission to advance the management of the country’s economy, and ultimately, sustainable development.”

“According to our information, the CBN through a Circular to all banks and other financial institutions dated February 10 2025 stated that it has reviewed and increased the ATM transaction fees prescribed in section 10(7) of the CBN Guide to Charges by Bank, Other Financial and Non-Bank Financial Institutions 2020.”

“Section 42(1)(a) of the CBN Act 2007 provides that ‘The Bank shall wherever necessary seek the co-operation of and co-operate with other banks in Nigeria to – (a) promote and maintain adequate and reasonable financial service for the public.’ It also provides that any policy of the CBN ‘shall be in the national interest.’”

“Section 1(c)(d) of the Federal Competition and Consumer Protection Act, 2018 provides that the objectives of the Act are to ‘protect and promote the interests and welfare of consumers’ and ‘prohibit restrictive or unfair business practices’ such as the exorbitant and unreasonable increase in ATM transaction fees by the CBN.”

“Significantly, the provisions of the Federal Competition and Consumer Protection Act are directly binding on the CBN, as the provisions constrain the exercise of the statutory powers and functions of the institution.”

“Specifically, section 2(1) the Act provides that its provisions ‘apply to all undertakings [such as the CBN] and scope of application to all commercial activities within, or having effect within, Nigeria.”

“Section 2(2) provides that, ‘This Act also applies to and is binding upon- (a) a body corporate or agency of the Government of the Federation; (b) a body corporate; (c) all commercial activities aimed at making profit and geared towards the satisfaction of demand from the public.’”

“According to section 70(1) of the Act, ‘For the purpose of this Act, an undertaking [such as the CBN] is considered to be in a dominant position if it is able to act without taking account of the reaction of its customers or consumers.’”

“The Act prohibits abuse of dominant position by the CBN including charging excessive ATM transaction fees to the detriment of consumers.”

“Section 104 of the of the Act asserts the supremacy of the Act over ‘the provisions of any other law’, such as the CBN Act. The only exception to the provision is the Nigerian Constitution 1999 [as amended].”

“Section 127(1) of the Act also prohibits the CBN from making any policy or providing “any services at a price that is manifestly unfair, unreasonable or unjust.”

“The CBN has clear responsibilities under the United Nations Guiding Principles on Business and Human Rights (UNGPs) to undertake human rights due diligence to identify and mitigate contributions to human rights violations of not only its own activities but also activities to which it is directly linked by its business relationships.”

“The CBN has responsibilities under the UNGPs to take effective steps to avoid or mitigate potential human rights harm and to consider ending any charges or transaction fees where severe negative human rights consequences cannot be avoided or mitigated.”