The Central Bank of Nigeria (CBN) has given Deposit Money Banks and other financial institutions a 48-hours ultimatum to refund failed transactions from Automated Teller Machine.
The directive came as part of the apex bank’s a sweeping reform aimed at protecting consumers and restoring confidence in the banking system.
The directive is contained in a draft guideline released yesterday by the apex bank, titled “Exposure of the Draft Guidelines on the Operations of Automated Teller Machines in Nigeria.”
The document, signed by the Director of Payments System Policy Department, Musa I. Jimoh, was circulated to banks, payment service providers, card schemes, and independent ATM deployers, with a call for stakeholder feedback by October 31, 2025.
Under the draft, failed “on-us” transactions, where customers use their own bank’s ATM, must be reversed instantly. If technical glitches prevent immediate reversal, the bank is required to manually refund the customer within 24 hours.
For “not-on-us” transactions, involving 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 stressed.
In a significant shift, the CBN mandated banks and ATM acquirers to deploy technology that automatically reverses failed or partial transactions, removing the need for customers to lodge complaints.
Institutions holding customer funds due to failed disbursements must reconcile and return balances immediately.
The measures, according to the Central Bank (CBN), is aim to address widespread customer frustration over delayed refunds and poor service. This initiative is part of a broader strategy to strengthen consumer protection, enhance system reliability, and modernise Nigeria’s payment infrastructure to meet global standards.
A key part of the guidelines is a nationwide overhaul of ATM operations. Banks and card issuers are now mandated to deploy a minimum of one ATM for every 5,000 active cards. This will be implemented in phases: 30% compliance by 2026, 60% by 2027, and 100% by 2028. Any new deployment, relocation, or removal of an ATM will now require prior approval from the CBN.
To improve security, all ATMs must be equipped with anti-skimming devices and CCTV cameras, and be situated in enclosed or well-lit areas.
The machines must also comply with Payment Card Industry Data Security Standards (PCI DSS), maintain detailed audit logs, and display functional helpdesk contacts. Furthermore, at least 2% of all ATMs must include tactile symbols for visually impaired customers.
Additional operational requirements stipulate that ATMs must:
· Dispense cash before returning the card.
· Allow free PIN changes.
· Issue receipts for all transactions except balance inquiries.
· Display all transaction fees clearly.
· Dispense only clean banknotes.
· Have backup power to reduce downtime.
If an ATM is out of service for more than 72 consecutive hours, the operator must publicly disclose the reason and the expected restoration time.
The CBN will enforce these rules through regular audits, on-site inspections, and monthly reports from operators detailing their ATM deployments and locations. Institutions that fail to comply face sanctions, though specific fines were not detailed.
The apex bank explained that the overhaul was necessary due to 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 landscape has grown rapidly in recent years, with 200 million cardholders and rising reliance on digital banking, but network failures, poor infrastructure, and delayed reversals have continued to undermine confidence.
The fresh guidelines, coming eight months after a revision of ATM fees, are expected to streamline service delivery, enhance transaction security, and hold banks accountable. Stakeholders are invited to submit feedback ahead of the final policy adoption, which could take effect before the end of the year.
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