Who Should Bear the Cost of ATM Withdrawals: Nigerians or Banks?

As Nigerian banks continue to charge fees for ATM withdrawals, people are questioning if these charges are fair. This issue became more prominent after the Central Bank of Nigeria (CBN) announced in February 2025 that it would stop allowing three free monthly withdrawals at ATMs from other banks. 

While withdrawals from a customer’s own bank’s ATM will remain free, using another bank’s ATM will cost N100 for every N20,000 withdrawn, and using off-site ATMs could cost up to N500 extra.

Policy Change Sparks Debate

This new policy has led analysts to suggest that maybe banks should cover these ATM fees as part of their operating costs, especially since banks are already making money from other fees. This could improve customer service and help more people access banking services.

The Cost of Convenience

The real question is why are banks still charging for ATM withdrawals when they already make a lot of profit? It is believed that the cost of running ATMs should be part of the bank’s regular services, not extra charges for customers. 

An expert pointed out that operating ATMs is expensive, especially when compared to the fees charged by POS terminals.

The discussion also covered whether ATMs should be a way for banks to make more money or if they should just be a basic service. 

Banks should focus on customer convenience rather than making money from ATM fees. if ATMs were only for a bank’s own customers, they could be seen as an added service.

Operational Costs and Challenges

They also talked about the costs involved in keeping ATMs running, like the need for constant power and cash management.

These costs are made worse by POS operators who often withdraw a lot of cash, leaving ATMs empty.
Experts are divided on whether banks should absorb the ATM operating costs to ease the burden on customers or if these charges are needed for banks to stay profitable and sustainable.

The Future of ATM Fees

The big question is whether banks should cover ATM costs to create a more inclusive banking environment or if these fees are essential for the banks’ business.