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 issued by the apex bank on Saturday, titled “Exposure of the Draft Guidelines on the Operations of Automated Teller Machines in Nigeria.”
The document, signed by Musa I. Jimoh, Director of the Payment System Policy Department, was distributed to banks, payment service providers, card schemes, and independent ATM deployers, with a request for stakeholder feedback by October 31, 2025.
According to the proposal, botched “on-us” transactions, in which clients utilize their own bank’s ATM, must be reversed immediately. If technical problems prohibit immediate reversal, the bank must manually repay the customer within 24 hours.
Refunds for “not-on-us” transactions using ATMs from other banks 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 stressed.
In a significant shift, the CBN ordered that banks and ATM acquirers use technology that automatically reverses failed or partial transactions, eliminating the need for clients to file complaints.
Institutions that hold client cash owing to unsuccessful disbursements must immediately reconcile and restore balances.
According to the apex bank, these measures respond to popular dissatisfaction with delayed refunds and poor customer service and are part of a larger effort to strengthen consumer safety and reliability and modernize Nigeria’s payment infrastructure in accordance with global standards.
The recommendations will also restructure ATM operations across the nation. Banks and card issuers must now deploy at least one ATM for every 5,000 active cards, with staggered targets of 30% compliance in 2026, 60% in 2027, and full compliance by 2028. Any future ATM deployment, relocation, or decommissioning must first be approved by the CBN.
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ATMs must be equipped with anti-skimming equipment and CCTV cameras, as well as placed in enclosed or well-lit places, to assure their safety.
Machines are expected to follow Payment Card Industry Data Security Standards, keep audit records, and provide functional helpdesk contacts. At least 2% of all ATMs must provide tactile symbols for visually challenged consumers.
ATMs must also dispense cash before returning cards, offer free PIN changes, produce receipts for all transactions except balance inquiries, display clear transaction costs, dispense only clean banknotes, and provide backup power to reduce downtime.
Downtime cannot exceed 72 consecutive hours, after which operators must notify the public of the cause and estimated restoration time.
The CBN will enforce compliance through regular audits, on-site inspections, and monthly reports from ATM operators detailing deployments and locations. Defaulting institutions may face sanctions, though fines were not specified.
The overhaul was necessary due to rising complaints about failed transactions, cyber fraud, and declining service quality. The goal is to build a payments system that works seamlessly for everyone, including urban areas.
Nigeria’s electronic payments ecosystem has expanded significantly in recent years, with 200 million cardholders and an increasing reliance on digital banking, but network failures, insufficient infrastructure, and delayed reversals have continued to erode trust.
The new guidelines, which come eight months after the modification of ATM fees, are expected to improve service delivery and transaction security and hold banks accountable.
Stakeholders are urged to provide feedback ahead of the final policy approval, which could go into effect by the end of the year.
