By David Akinmola
The Central Bank of Nigeria (CBN) has issued new guidelines mandating deposit money banks and other financial institutions to provide instant refunds for failed Automated Teller Machine (ATM) transactions, in a move aimed at strengthening consumer protection and improving confidence in electronic payment systems.
According to a circular released by the apex bank, the new framework requires banks to ensure that customers whose accounts are debited without receiving value from ATM withdrawals are refunded automatically within minutes of the failed transaction.
Previously, the process for reversing such failed transactions could take up to 72 hours or longer, leading to widespread complaints among bank customers. The CBN said the new measures will eliminate unnecessary delays and enhance public trust in the banking system.
The guidelines also direct banks to upgrade their transaction monitoring systems to detect failed transfers and dispense errors in real time. Financial institutions that fail to comply may face regulatory sanctions, including penalties and customer compensation.
In addition, the CBN emphasized that the new policy covers all electronic channels, including point-of-sale (PoS) terminals, web transactions, and mobile transfers, not just ATMs. The apex bank said the initiative aligns with its broader efforts to promote financial inclusion and strengthen the integrity of Nigeria’s cashless payment ecosystem.
Customer complaints about failed transactions have surged in recent years amid increasing reliance on digital banking platforms. The CBN noted that the new refund mechanism would help reduce friction between banks and their customers while improving overall service delivery.
The new guidelines take effect immediately, and all financial institutions are expected to comply fully.
