The Central Bank of Nigeria (CBN) has directed Deposit Money Banks and other financial institutions to refund customers for failed Automated Teller Machine (ATM) transactions within 48 hours, as part of efforts to strengthen consumer protection and restore confidence in the nation’s banking system.

The directive was contained in a new draft document titled “Exposure of the Draft Guidelines on the Operations of Automated Teller Machines in Nigeria,” released on Saturday.

Signed by Musa I. Jimoh, Director of the Payments System Policy Department, the document was circulated to banks, payment service providers, card schemes, and independent ATM operators, inviting industry feedback by October 31, 2025.

Under the proposed framework, failed “on-us” transactions—where customers use ATMs belonging to their own banks—must be automatically reversed. Where instant reversal is not possible due to technical issues, refunds must be processed manually within 24 hours.

For “not-on-us” transactions involving ATMs of other banks, refunds are to be completed within 48 hours.

“Customers must not be made to suffer for failed transactions caused by system errors or network failures,” the circular emphasized.

The CBN stated that the new policy aims to address persistent complaints about slow reversals, poor service delivery, and rising customer frustration. It also seeks to modernize Nigeria’s payment infrastructure and align domestic practices with international standards.

To enhance efficiency, banks and ATM operators are now required to deploy advanced systems capable of automatically reversing failed or partial transactions, eliminating the need for manual complaint filing. Funds held from failed cash disbursements must be promptly reconciled and returned to customers.

The guidelines also introduce a major overhaul of ATM deployment and management across the country. Banks and card issuers are mandated to provide at least one ATM for every 5,000 active cards, with compliance milestones set at 30% by 2026, 60% by 2027, and 100% by 2028.

Any installation, relocation, or removal of ATMs must receive prior approval from the CBN.

To improve safety and accessibility, all ATMs must be equipped with anti-skimming technology, CCTV surveillance, and installed in well-lit or enclosed areas. Machines are also expected to meet Payment Card Industry Data Security Standards (PCI-DSS), maintain detailed audit logs, and display functional customer support contacts.

At least 2% of ATMs nationwide must include tactile features to assist visually impaired users.

Other mandatory standards include cash-first dispensing (before card return), free PIN changes, receipts for all transactions except balance inquiries, clear display of transaction fees, and issuance of only clean banknotes. ATMs must also have backup power systems to minimize downtime.

The new rules cap machine downtime at 72 consecutive hours, after which operators must publicly disclose the cause of the outage and provide an estimated restoration time.

The apex bank said it will enforce compliance through periodic audits, on-site inspections, and monthly reports from ATM operators detailing deployments and operational status. Institutions that fail to meet the new standards will face sanctions, though the circular did not specify penalties.

Explaining the rationale behind the overhaul, the CBN cited rising cases of failed transactions, cyber threats, and declining service quality as major concerns.

“The goal is to build a payments system that works seamlessly for everyone, urban and rural users alike,” the bank noted.

Stakeholders are expected to submit comments and recommendations before the final version of the guidelines is issued, with full implementation projected before the end of the year.