Financial technology experts and heads of electronic banking have urged the Central Bank of Nigeria to desist from charges on remote-to-us Automated Teller Machine transactions and review the regulation that increased cost of operating ATMs.
Speaking at the Fintech 1000 Special Webinar on Wednesday, operators in the banking and financial technology space said the rising cost of deploying and maintaining ATMs had been the major reason for the reduced deployment level of ATMs in the country.
Stakeholders at the event had also called on the CBN to allow banks to rightly charge customers for using remote-on-us ATMs, whereby a customer uses their card on an ATM not owned by their bank, rather than fixing the charge at N65 after the third withdrawal in a month.
The CBN had cut down the charges of remote-on-us withdrawals from N100 per transaction to N65 and made the first three withdrawals in a month free in 2015. However, speakers at the event noted that the remote-on-us costs banks about N100, which had become heavy on the banks.
As at December 2019, total number of ATMs deployed in the country stood at 17,518 lower than 18,615 ATM that had been deployed in 2018.
According to Head of eChannels at First Bank, Bob Nwojo, Nigeria’s total ATM per 100,000 adults is four times less than that of South Africa.
He noted that with similar population figures, Brazil has nearly 10 times the number of ATMs than Nigeria and covers four times the number of branches per 100,000 customers.
Nwojo said regulation on deployment had been one of the factors affecting the low number of ATMs in the country.
On his part, executive director at Inlaks, Tope Dare, noted the need to re-visit the regulation on ATM deployment, arguing that it takes up to three to six months for banks to get approval from the CBN to mount a machine.
“Despite the declining number of ATM points in the country, the channel is still heavily utilised, as it remains the preferred channel. Deploying ATM is capital-intensive and not profitable for banks in Nigeria,” he said.
Secretary, Product Pricing and Revenue Assurance at Committee of e-Banking Industry Heads, Oladipupo Alabede, while speaking at the event, noted that expenses of remote-on-us had been on the rise.
He added that many banks were no longer deploying off-site ATMs due to the cost of deployment and maintenance.
“Off-site ATMs are more expensive and difficult to manage,” he said.
Similarly, Divisional Chief Executive at Interswitch, Akeem Lawal, said that the present condition could not attract independent ATM operators.
His words, “It costs banks almost N100 to deliver cash to customers at ATM and for independent providers the cost rises to N200.”
