Nigerians continued to lean heavily on cash withdrawals despite higher automated teller machine charges introduced by the Central Bank of Nigeria, as the value of ATM transactions jumped to N36.34tn in the first half of 2025, reinforcing the resilience of cash usage in the economy.

Data from the CBN quarterly statistical bulletin show that ATM withdrawals between January and June 2025 amounted to N36.34tn, nearly tripling the N12.21tn recorded in the corresponding period of 2024.

This represents an increase of N24.13tn, equivalent to a 197.66 per cent year on year rise, even as regulators moved to discourage excessive cash usage through revised fees and tightening monetary policy.

According to the data on the transaction volumes, Nigerians carried out 858.80 million ATM withdrawals in the first six months of 2025, compared with 496.47 million transactions in the same period of 2024. The increase of 362.34 million transactions represents a growth rate of 72.98 per cent, indicating that higher charges did little to dampen demand for cash.

The sharp rise comes against the backdrop of the CBN’s revised ATM fee regime, which took effect in March 2025. Under the new framework, customers using another bank’s ATM now pay N100 per N20,000 withdrawn, with additional surcharges of up to N500 per N20,000 on offsite ATMs such as those located in malls, fuel stations, and airports.

The removal of the previous allowance of three free monthly withdrawals on other banks’ ATMs further increased the cost of accessing cash. The apex bank attributed the review to rising costs and the need to enhance efficiency in ATM operations.

The circular read, “In response to rising costs and the need to improve efficiency of Automated Teller Machine (ATM) services in the banking industry, the Central Bank of Nigeria has reviewed the ATM transaction fees prescribed in Section 10.7 of the extant CBN Guide to Charges by Banks, Other Financial 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 fees with effect from March 1, 2025.”

Despite these changes, quarterly data show that ATM usage accelerated markedly in 2025. In the first quarter, ATM withdrawals totalled N15.97tn, compared with N5.46tn in the first quarter of 2024. This reflects an increase of N10.52tn, or about 192.9 per cent.

Transaction volumes in the quarter rose from 210.66 million to 411.42 million, an increase of 200.76 million transactions, equivalent to roughly 95.3 per cent growth.

The momentum strengthened further in the second quarter. Between April and June 2025, Nigerians withdrew N20.36tn from ATMs, more than three times the N6.75tn recorded in the second quarter of 2024. The increase of N13.61tn represents a growth of about 201.7 per cent.

Volumes also rose from 285.81 million transactions in the second quarter of 2024 to 447.39 million in the same period of 2025, an increase of 161.57 million transactions or about 56.5 per cent. A closer look at the monthly figures highlights how consistently ATM usage expanded throughout the six-month period.

In January 2025, ATM withdrawals stood at N4.81tn, compared with N2.15tn in January 2024. Transaction volumes more than doubled, rising from 69.62 million to 147.24 million, a year-on-year increase of about 111.5 per cent.

February saw withdrawals rise to N5.40tn, up from N1.72tn a year earlier, representing growth of about 215 per cent. Transaction volumes climbed from 73.16 million to 134.59 million, an increase of roughly 84 per cent.

In March, ATM withdrawals reached N5.76tn, compared with N1.60tn in March 2024, translating to a growth of about 261 per cent, while volumes increased by about 91 per cent to 129.59 million transactions.

The second quarter sustained the upward trend. In April 2025, withdrawals rose to N6.38tn from N1.81tn in April 2024, an increase of about 252 per cent, with transaction volumes growing by roughly 77 per cent.

May recorded the highest monthly withdrawal value in the period at N7.44tn, up from N2.49tn a year earlier, representing a growth of about 199 per cent. Volumes also increased from 92.97 million to 160.10 million transactions, a rise of about 72 per cent.

In June, ATM withdrawals eased slightly to N6.55tn but still far exceeded the N2.45tn recorded in June 2024. The year-on-year increase of about 167 per cent was accompanied by a rise in transaction volumes from 113.17 million to 146.27 million, representing growth of about 29 per cent.

The persistence of high ATM usage contrasts with the steady expansion of point-of-sale transactions, which continue to dominate in absolute terms. POS transaction values rose from N85.91tn in the first half of 2024 to N147.20tn in the first half of 2025, while volumes increased from 6.40 billion to 7.72 billion transactions.

However, the pace of growth in ATM withdrawals outstripped that of POS channels, highlighting the enduring role of cash in daily economic activity.

In a FAQ document published by the apex bank on its website, which provides further information on the CBN’s directive on ATM withdrawal fees, the apex bank clarified that financial institutions are not permitted to charge more than the prescribed fees, although banks may reduce charges depending on their business strategy.

Any bank found in violation of the directive, including compelling customers to withdraw less than N20,000 per transaction despite sufficient funds in their account, will be sanctioned accordingly.

To minimise transaction fees, the CBN has advised customers to prioritise withdrawals from their bank’s own ATMs. It also encouraged Nigerians to explore alternative payment methods such as mobile banking applications, POS transactions, and electronic transfers to reduce reliance on cash withdrawals.

A FinTech Executive and Techpreneur, Tope Dare, earlier warned that the CBN’s revised ATM withdrawal fees, set to take effect on March 1, 2025, will hurt low-income Nigerians while benefiting wealthier individuals.

“This policy ultimately favours those who can afford to withdraw larger sums, while the average Nigerian, who withdraws in smaller amounts, bears the brunt. For many low-income earners and small business owners, withdrawing N5,000 or N10,000 at a time is a daily necessity. Now, they face unfair charges that wealthier Nigerians can easily avoid,” he said.

Also, consumer rights group Socio-Economic Rights and Accountability Project took legal action against the CBN, calling the policy “unfair, unreasonable, and unjust.” SERAP argued that the revised fees violate sections of the Federal Competition and Consumer Protection Act, which aims to prevent exploitation and ensure fair market practices.

In a statement signed by the TUC President, Festus Osifo, and Secretary-General, Nuhu Toro, the union urged all well-meaning Nigerians to reject what it described as an exploitative policy and demand its immediate reversal.

“Our attention has been drawn to a circular from the CBN announcing an increase in ATM transaction fees, effective March 1, 2025. We say unequivocally: enough is enough. The Nigerian workers and the general public have endured relentless economic hardship under this administration.

“Every day brings a new burden—higher taxes, rising electricity tariffs, exorbitant call and data charges, and now, increased ATM fees. This government has failed to cushion the effects of its harsh economic policies, and the patience of Nigerians is wearing thin.”

However, the Chairman of the Bank Customers Association of Nigeria, Dr. Uju Ogubunka, said the increase was not such a bad idea, given the state of the economy, but expressed concerns about the rate of increase.

He said, “It should have been expected. Other places have increased their fees. The only thing one can talk about is the extent of the increase. Electricity, telephones, and even the open market have recorded increases in prices. The issue should not be the increase but the extent of it. Is it reasonable? Is it affordable at this point in time?

“It is not only banking services that are increasing fees. If you ask me, I will say let’s move on. Someday, these things will adjust themselves.”

Also in October 2025, the CBN directed Deposit Money Banks and other financial institutions to refund customers for failed ATM transactions within 48 hours, in a sweeping reform aimed at protecting consumers and restoring confidence in the banking system.

According to the apex bank, these measures respond to widespread frustration over delayed refunds and poor customer service and form part of a broader effort to enhance consumer protection, improve reliability, and modernise Nigeria’s payment infrastructure in line with global standards.

The guidelines also overhauled ATM operations nationwide. Banks and card issuers are now required to deploy at least one ATM for every 5,000 active cards, with phased targets of 30 per cent compliance in 2026, 60 per cent in 2027, and full compliance by 2028. Any future deployment, relocation, or decommissioning of ATMs must receive prior approval from the CBN.

As ATMs become more efficient, The PUNCH observed an increase in cash outside banks. The PUNCH earlier reported that Nigerians withdrew a net N264.48bn from the banking system in November 2025, pushing the total cash held outside banks to N4.91tn, according to the CBN’s latest money and credit statistics data.

This represented a sharp month-on-month rise from N4.65tn recorded in October 2025, highlighting the continued preference for physical cash in daily transactions despite efforts to deepen electronic payment channels.

The data showed that currency in circulation as a whole also increased in November 2025, rising to N5.26tn from N5.06tn in October. This means the share of total currency circulating outside the banking sector climbed to about 93.34 per cent in November from 91.87 per cent in October.

The growing preference for physical cash raises several macroeconomic concerns. High out-of-bank cash weakens monetary control, reduces deposit mobilisation, creates liquidity constraints for banks, and encourages informal transactions that escape regulatory visibility.

It also complicates inflation targeting, as large cash holdings outside the banking system blunt the effectiveness of policy. The sharp rise in currency outside banks comes at a time when the CBN is focused on tightening liquidity to curb inflation.