Friday, 15 August 2014

Shocking Reason CBN Re-Introduced ATM Charges!

LAGOS—The Central Bank of Nigeria, CBN, yesterday said it has not
reintroduced charges on the use of Automated Teller Machines, ATMs
as being speculated.

The Director, Banking & Payments System Department of CBN, Mr.
Dipo Fatokun, who explained this to Vanguard after his remarks at
the meeting held by Nigeria Electronic Fraud Forum in Lagos, said:

“It is not a reintroduction per se . You have to agree with me that
when the amendment was made in November 2012, it used to be a
N100 for any remote-on-us withdrawal that you did. And you know
that the remote-on-us is when you as a card holder goes to the ATM
of a bank other than your bank to withdraw cash. It was removed
then so that people would be encouraged to go to other ATMs without
paying for it.

But the truth is that as we said in the circular on the Introduction of
Fees on Remote-On-Us ATM Withdrawal Transactions recently, that
N100 included the N35 that goes to the issuing bank, which has now
been completely waived. The issuing bank does not make any thing,
but in going to other ATMs to make withdrawal , your bank, that is,
the acquirer bank incurs cost of N65 which they pay to the switches
and the owner of the ATM that you are using.

Continuing, he said:

”Between 2012 and recently when the review was
done, it was discovered that people have actually turned ATMs into
their personal purses because nothing is charged. Somebody needs
N500, or N1000, he will go to ATM and withdraw, he needs N2000, he
will go to ATM and withdraw, so that in a day some people can
patronise ATM for up to four or ten times. That has created a huge
cost burden for the banks that issue the cards. It was becoming
discouraging to them.

“So that is why we said, you can go to an ATM other than your bank
ATM to withdraw up to three times and no charges would be
imposed on you, but it is when you make the fourth withdrawal that
you will pay the N65 that ordinarily your bank would have paid on
your behalf. But of course if you go to your bank’s ATM, the issuer,
for withdrawal you can withdraw as many times as you like without
being charged. So, it does not discourage financial inclusion. You
should bear in mind that when you talk of cashless regime, you are
encouraging people to do their transactions electronically other than
the use of cash. So it is a motivation for people to patromise the
ATM. “

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