Are ATMs Becoming Useless in Nigeria?

ATMs used to be the easiest way for Nigerians to get cash. They were everywhere—at banks, shopping malls, and fuel stations. But today, when people need cash, they don’t rush to an ATM. Instead, they go straight to a Point-of-Sale (POS) agent.

Many ATMs now sit empty, broken, or out of service. People queue for hours only to find “NO CASH” displayed on the screen. Others have stopped trying altogether. It raises an important question: Are ATMs becoming useless in Nigeria?

The decline of ATMs

ATMs were once a game-changer for banking in Nigeria. They saved people from long queues inside banks and gave 24/7 access to cash. But in recent years, they have lost their usefulness, and it all started with the Central Bank of Nigeria’s (CBN) naira redesign policy in 2022.

The policy was meant to push for a cashless economy, but instead, it led to a severe cash scarcity. Even after the policy was reversed, ATMs never fully recovered. Today, many of them are either empty or unreliable.

Why are ATMs no longer working?

Several reasons explain why ATMs in Nigeria are failing:

Banks are not loading them with cash

After the naira redesign crisis, banks started limiting cash in circulation. Even though the old notes returned, banks did not return to their old ways of loading ATMs regularly. Instead, they now prioritize POS agents, who often charge extra for withdrawals.

ATMs are expensive to maintain

Keeping an ATM running costs a lot of money. Banks have to refill cash, power the machines, and provide security. Diesel costs are high, and frequent power cuts make it even harder. Rather than dealing with all these expenses, banks are shifting focus to online banking and POS systems.

Security issues

ATMs are easy targets for fraudsters. Criminals use skimming devices to steal card details, and some even vandalize the machines. This has discouraged banks from investing in new ATMs or maintaining existing ones.

POS agents are taking over

POS businesses have exploded across Nigeria. With over a million POS agents operating in the country, people no longer depend on ATMs. The convenience of walking into a shop and withdrawing money has made POS machines the new go-to cash source. Banks also seem to prefer this system, as they make money from transaction fees.

Is there a way to fix this?

ATMs may not disappear completely, but their role is shrinking. However, there are ways to bring them back to relevance:

• Banks should be required to load ATMs with cash regularly, just as they supply POS agents.
• Solar-powered ATMs could help reduce operational costs, especially in areas with poor electricity.
• More deposit-taking ATMs can help maintain cash flow by allowing people to withdraw and deposit money at the same time.
• Better security measures like surveillance cameras and fraud detection can reduce ATM crimes and make banks more confident in keeping them operational.

What’s next for ATMs in Nigeria?

ATMs are no longer as useful as they once were. Digital banking, mobile transactions, and POS withdrawals are now the norm. Unless the government and banks take action, ATMs may continue to fade into irrelevance.

For now, one thing is clear, getting cash from an ATM in Nigeria is more of a gamble than a guarantee.