CBN reduces ATM charges for third party withdrawal to N35

The Central Bank of Nigeria (CBN) has directed banks to reduce charges on Automated Teller Machines (ATMs) withdrawals for customers from other banks to N35.

The charge, which was reduced from the previous N65 fee, applies after the third withdrawal within one month.

This was contained in the revised Guide to Bank Charges signed by Chibuzo Efobi for CBN Director, Financial Policy and Regulation Department.

It showed a downward review for electronic banking transaction charges to align with market developments and inclusion of new sections on accountability and sanctions for defaulting banks.

The guideline, which takes effect January 1, 2020, is in furtherance of CBN’s quest to make financial services more accessible and affordable to various stakeholders in the economy.

Other major highlights of the new policy include removal of Card Maintenance Fee (CAMF) on all cards linked to current accounts, a maximum of one Naira per mille for customer induced debit transactions to third parties and transfers or lodgments to the customers’ account in other bank on current accounts only, cut in Advance Payment Guarantee (APG) now pegged at maximum of one per cent of the APG value in the first year and 0.5 per cent for subsequent years on contingent liabilities.

CBN Director, Corporate Communications, Isaac Okorafor, explained that on debit card charges, the new guide stipulates that a one-off charge of N1,000 applies to the issuance of cards, irrespective of card type (regular or premium).

The same one-off charge of N1,000 applies for the replacement of debit cards at the customer’s instance for lost or damaged cards.

In the same vein, upon expiry of existing cards, customers are to pay the same one-off charge of N1,000 irrespective of card type. Conversely, no charge shall be required for pre-paid card loading/unloading.

Furthermore, there will be no more charges for reactivation or closure of accounts such as savings, current and domiciliary accounts while status enquiry at the request of the customer (like confirmation letter, letter of non-indebtedness and reference letter) will now attract a fee of N500 per request.

On Current Account Maintenance Fee (CAMF), the Guide expressly stated that this would be applicable only to current accounts in respect of customer-induced debit transactions to third parties and debit transfers/lodgments to the customer’s account in another bank. It emphasized that CAMF is not applicable to Savings Accounts.

The CBN carried out the review of the Guide, which also prescribes charges permissible for Other Financial Institutions and non-bank financial institutions, in order to align with market developments.

“To guard against excess, unapproved or arbitrary charges by banks and other financial institutions, the Guide stipulates a penalty of N2,000,000 per infraction or as may be determined by the CBN from time to time for financial institutions that breach any provision of the guide.”