The Central Bank of Nigeria (CBN) has directed Deposit Money Banks and other financial institutions to refund customers for failed Automated Teller Machine (ATM) transactions within 48 hours, in a sweeping reform aimed at protecting consumers and restoring confidence in the banking system.
The directive is contained in a draft guideline released by the apex bank, titled “Exposure of the Draft Guidelines on the Operations of Automated Teller Machines in Nigeria.”
Signed by the Director of Payments System Policy Department, Musa I. Jimoh, the document was circulated to banks, payment service providers, card schemes, and independent ATM deployers, inviting stakeholder feedback by October 31, 2025.
Under the draft policy, failed “on-us” transactions—where customers use their own bank’s ATM—must be reversed instantly. If technical glitches prevent immediate reversal, the bank must manually refund the customer within 24 hours.
For “not-on-us” transactions, which involve other banks’ ATMs, refunds must be processed within 48 hours.
“Customers must not be made to suffer for failed transactions caused by system errors or network failures,” the circular emphasized.
The CBN also mandated banks and ATM acquirers to deploy technology that automatically reverses failed or partial transactions, eliminating the need for customers to lodge complaints.
Institutions holding customer funds due to failed disbursements must reconcile and return balances immediately.
According to the apex bank, these measures address widespread frustration over delayed refunds and poor customer service and are part of a broader effort to enhance consumer protection, improve reliability, and modernize Nigeria’s payment infrastructure in line with global standards.
The guidelines will also overhaul ATM operations nationwide. Banks and card issuers must now deploy at least one ATM for every 5,000 active cards, with compliance targets of 30% by 2026, 60% by 2027, and 100% by 2028. Any deployment, relocation, or removal of ATMs will now require prior approval from the CBN.
To improve safety, ATMs must be equipped with anti-skimming devices, CCTV cameras, and installed in enclosed or well-lit areas. Machines must comply with Payment Card Industry Data Security Standards (PCI-DSS), maintain audit logs, and display functional helpdesk contacts. At least 2% of all ATMs must also feature tactile symbols for visually impaired users.
ATMs are further required to dispense cash before returning cards, allow free PIN changes, issue receipts for all transactions (except balance inquiries), display clear transaction fees, dispense only clean banknotes, and have backup power to reduce downtime.
Downtime must not exceed 72 consecutive hours, after which operators must inform the public of the cause and expected restoration time.
The CBN said it will ensure compliance through regular audits, on-site inspections, and monthly reports from ATM operators detailing deployments and locations. Defaulting institutions risk sanctions, though fines were not specified.
The apex bank explained that the overhaul was necessary to address rising complaints about failed transactions, cyber fraud, and declining service quality, noting that “the goal is to build a payments system that works seamlessly for everyone—urban and rural users alike.”
Nigeria’s electronic payments sector has grown rapidly, with over 200 million cardholders and increasing reliance on digital banking. However, persistent network failures and delayed reversals have continued to erode public confidence.
The new guidelines—coming just eight months after a revision of ATM fees—are expected to streamline service delivery, enhance transaction security, and hold banks accountable. Stakeholders are encouraged to submit feedback ahead of the policy’s final adoption, expected before the end of the year.
