Breaking news: Banks have finally found a way to make money without lending a kobo—just charge people for accessing their own cash.
Starting March 1, 2025, Nigerians won’t need to worry about saving money, because their banks will be doing the saving for them—one ATM withdrawal at a time—just that you can never access the funds. Sounds like a well-planned heist, right? Except this one is perfectly legal.
Nigerians will now be paying through their noses just to access their own funds, thanks to the Central Bank of Nigeria’s (CBN) latest policy blessing the banks with a multi-trillion-naira windfall in ATM charges.
Let’s break it down.
The Billion-Naira Cash Grab Disguised as Policy
Under the new policy:
- On-Us Transactions: Withdrawals at your bank’s ATM? Free. (Phew.)
- Not-On-Us Transactions: Withdraw at another bank’s ATM? That’ll be ₦100 per ₦20,000.
- Off-Site ATMs: Withdraw from an ATM that isn’t inside a bank? That’s ₦100 per ₦20,000 withdrawal, plus a surcharge of up to ₦500.
- International Withdrawals: Fees are “based on cost recovery,” meaning whatever the international acquirer charges will be passed directly to you.
At first glance, ₦100 per withdrawal doesn’t seem like much—until you do the math.
How Banks Will Make ₦2.2 Trillion from Your Money
…and that’s just based on one withdrawal per active account a month
With 311.6 million active bank accounts in Nigeria, even a single monthly withdrawal per account could generate huge profits:
- Domestic Withdrawals: ₦100 x 311.6 million = ₦31.16 billion per month.
- Off-Site ATM Withdrawals: ₦600 per withdrawal x 311.6 million = ₦186.96 billion per month.
That’s over ₦2.2 trillion per year—not from lending, not from business investments, but simply from letting people access their own money.
And all this in an economy where inflation is running at over 30%, unemployment is skyrocketing, and the new ₦70,000 minimum wage barely covers rent and food.
If a worker withdraws ₦80,000 in a month from off-site ATMs, they could pay up to ₦2,000 in fees—nearly 3% of their salary. Meanwhile, banks continue to report record profits.
From Banking to Legalised Extortion
Globally, banks earn primarily from lending. But in Nigeria, financial institutions have found a more innovative model: charging customers for every financial move they make.
- In the first quarter of 2024, top-tier banks raked in over ₦125 billion from electronic banking charges.
- With just 16,714 ATMs for over 200 million Nigerians, long queues and machine downtime are already the norm. This policy will push more people towards expensive PoS withdrawals, where agents also charge their own fees.
- By contrast, in countries like Kenya, digital banking is encouraged through zero ATM withdrawal fees for many account types. Even in South Africa, withdrawal charges are significantly lower. So why are Nigerian banks making their customers pay so much for basic services?
The CBN claims these charges will prevent customers from breaking withdrawals into smaller amounts. But let’s be honest: This is just another revenue stream for banks, cleverly wrapped in the language of “financial policy.”
The Central Bank of Nigeria, rather than acting as a regulator in the interest of financial inclusion, seems to be tilting towards policies that favour banks at the expense of customers.
The question is: why is there no cap on ATM charges? Why isn’t there a push for alternative, low-cost cash withdrawal solutions?
I mean! There is no upper limit or maximum limit on the charges for ATM transactions. The fees can vary and may increase based on different factors, such as the amount of money withdrawn or the location of the ATM. Essentially, there is no fixed maximum charge that customers can be guaranteed not to exceed.
This means you might encounter different fees depending on which bank’s ATM you use or whether the ATM is located on-site (at a bank branch) or off-site (at a different location, like a shopping mall).
Moving Towards Digital, or Just Financial Exclusion?
Supporters say that higher ATM fees will encourage electronic transactions—but here’s the problem:
- Digital Payments Are Not Universal: Many Nigerians, especially in rural areas, still rely on cash for daily transactions.
- Mobile Network Issues: Failed transfers and delayed alerts are common, making cash a safer option for many.
- Unbanked Population: With 26% of Nigerians still unbanked, these charges could further discourage financial inclusion.
So, what’s the alternative? Fintechs like Opay, PalmPay, and Kuda may benefit as Nigerians search for less exploitative banking options. But until digital banking becomes truly reliable, these ATM charges are nothing short of a tax on poverty.
So, Who Will Save Nigerians from Their Own Banks?
As it stands, the biggest threat to your finances isn’t inflation, unemployment, or even government policy—it’s your own bank.
At what point does banking stop being a service and start looking like state-approved extortion? Nigerians are being charged simply for existing within the banking system.
If the CBN does not cap these fees or introduce customer-friendly alternatives, we may soon see a mass exodus from traditional banking. The very institutions meant to safeguard our money seem more interested in finding new ways to take it—so as to “ease costs of operations.”
Until then, be prepared: In Nigeria, it now costs money to withdraw your own money.
