By Mercy Gadia Adi
The Central Bank of Nigeria (CBN) has released new draft guidelines compelling banks to provide instant refunds for failed Automated Teller Machine (ATM) transactions, in a move aimed at strengthening consumer protection and improving service reliability across the financial sector.
The draft rules, issued on October 9, 2025, and signed by Musa I. Jimoh, Director of the Payments System Policy Department, were addressed to banks, payment service providers, card schemes, and independent ATM deployers. Stakeholders have until October 31, 2025, to submit feedback before the guidelines are finalised.
Under the proposed framework, all on-us transactions where customers use their own bank’s ATMs must be reversed instantly. In cases where technical issues prevent immediate reversal, refunds must be processed manually within 24 hours. For not-on-us transactions conducted on other banks’ ATMs, the CBN set a maximum refund window of 48 hours.
ATM acquirers are required to deploy systems that automatically initiate refunds without waiting for customer complaints, and to reconcile all unreturned funds from failed or partial cash disbursements.
According to the CBN, the measure is designed to restore consumer confidence and address frustrations linked to delayed reversals.
The refund policy forms part of a broader overhaul of the country’s ATM regulatory framework, replacing sections of the 2020 electronic payments guidelines. The apex bank said the review reflects evolving payment technologies, increasing cyber risks, and efforts to deepen financial inclusion.
Among the new provisions, banks and card issuers must deploy at least one ATM for every 5,000 cards issued achieving 30% compliance by 2026, 60% by 2027, and full compliance by 2028. Any deployment, redeployment, or decommissioning of ATMs will require prior CBN approval.
The guidelines also set new operational standards, mandating compliance with Payment Card Industry Data Security Standards, installation of anti-skimming devices and surveillance cameras, and the inclusion of tactile symbols on at least 2% of ATMs to aid visually impaired users.
Machines must be installed in secure, well-lit areas, equipped with backup power, and configured to dispense cash before releasing cards to reduce the risk of abandoned funds. They must also allow free PIN changes, issue receipts on request, and dispense only fit banknotes.
The CBN said compliance will be monitored through regular audits, inspections, and mandatory monthly reports from operators. Institutions that fail to adhere to the guidelines will face sanctions.
The new directive comes about eight months after the apex bank revised ATM transaction fee structures, scrapping the three free interbank withdrawals previously granted to customers.