New Guidelines for ATM Transactions in Nigeria
The Central Bank of Nigeria (CBN) has introduced a set of updated guidelines that require banks to provide immediate refunds for failed Automated Teller Machine (ATM) transactions. This initiative is designed to enhance consumer protection and restore public confidence in electronic banking.
According to a circular issued on October 9, 2025, and signed by Musa I. Jimoh, director of the Payments System Policy Department, all deposit money banks, payment service providers, card schemes, and independent ATM operators are expected to comply with these new standards. Stakeholders have until October 31, 2025, to submit their feedback before the policy is finalized.
Timelines for Refunds
The proposed framework outlines strict timelines for resolving failed transactions. For on-us transactions—those conducted by a customer on their own bank’s ATM—refunds must be processed immediately. If system challenges prevent instant reversal, the bank must complete the process within 24 hours.
For not-on-us transactions, where a customer uses another bank’s ATM, the maximum refund period has been set at 48 hours. This ensures that customers do not face unnecessary delays when their transactions fail.
Automatic Refund Systems
To further protect customers, the guidelines require ATM acquirers to implement systems that automatically initiate refunds without waiting for customer complaints. The CBN emphasized that acquirers must also ensure that all funds from failed or partial cash withdrawals are reconciled and refunded promptly to affected customers.
This move is part of the CBN’s broader effort to promote efficiency, transparency, and accountability in the nation’s financial system. “This initiative is aimed at improving consumer trust and reducing the frustration often experienced by customers following failed electronic transactions,” the circular stated.
Review of Regulatory Framework
The CBN’s new directive forms part of a comprehensive review of the existing regulatory framework for ATMs, replacing the 2020 electronic payments guidelines. The review became necessary due to the rapid transformation of Nigeria’s digital payments landscape, the emergence of new technologies, and increasing risks associated with electronic transactions.
Under the new provisions, banks and card issuers are required to deploy one ATM for every 5,000 cards issued. The implementation will take place over three years: 30% by 2026, 60% by 2027, and full compliance by 2028.
Any plans for deployment, redeployment, or decommissioning of ATMs will now require prior approval from the CBN.
Operational Standards for ATMs
The guidelines also introduce higher operational standards for ATMs. Machines must now comply with Payment Card Industry Data Security Standards (PCI-DSS), maintain detailed audit logs to facilitate dispute resolution, and display clear card orientation symbols to prevent transaction errors.
These measures aim to create a more secure and efficient environment for electronic banking in Nigeria.
Key Highlights of the Guidelines
- Refund Timelines: Immediate refunds for on-us transactions, with a 24-hour window if system issues arise. Not-on-us transactions must be resolved within 48 hours.
- Automatic Refunds: Acquirers must implement systems that automatically initiate refunds without waiting for customer complaints.
- Compliance Requirements: ATMs must meet PCI-DSS standards, maintain audit logs, and display clear card orientation symbols.
- ATM Deployment: One ATM per 5,000 cards issued, with phased implementation over three years.
- Regulatory Oversight: Any changes to ATM networks require prior CBN approval.