The Socio-Economic Rights and Accountability Project (SERAP) has filed a lawsuit against the Central Bank of Nigeria (CBN) at the Federal High Court in Lagos, seeking to stop the implementation of the recent increase in Automated Teller Machine (ATM) transaction fees.
The legal action comes amid growing public outrage over the policy, which SERAP has described as “patently unlawful, unfair, and unjust.”
In a statement posted on its official X handle, SERAP argued that the new charges disproportionately affect poor Nigerians while benefiting commercial banks and the apex bank. The organization insisted that the court must intervene to prevent what it sees as an exploitative policy that will further marginalize low-income earners and those who rely on cash transactions.
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SERAP’s legal team, led by Kolawole Oluwadare and Andrew Nwankwo, filed the suit under case number FHC/L/CS/344/2025. In its court documents, SERAP accused the CBN of compromising its mandate to promote economic stability and sustainable development by enforcing policies that deepen financial exclusion. It also argued that the apex bank’s decision violates the Nigerian Constitution, the Federal Competition and Consumer Protection Act, and Nigeria’s international human rights obligations by increasing financial burdens on citizens without justification.
The lawsuit asks the court to determine whether the CBN’s decision to increase ATM withdrawal fees is arbitrary, unfair, and unreasonable and whether it contradicts the provisions of the Federal Competition and Consumer Protection Act 2018. Additionally, SERAP is seeking an interim injunction to restrain the CBN, its officers, agents, and any other parties acting on its directive from enforcing the new charges until a final ruling is made.
According to the statement, SERAP is seeking “an order of interim injunction restraining the CBN, its officers, agents, associates or any other persons acting on its directive or instructions from enforcing and giving effect to the decision, pending the hearing and determination of the motion on notice for an order of interlocutory injunction filed in this suit.”
SERAP contends that the increase in ATM fees will create an even deeper divide between those who can afford banking services and those who cannot. The group argues that many Nigerians, particularly in rural areas and low-income brackets, still rely on cash transactions, and making access to cash more expensive could discourage them from using formal banking services altogether. This, financial experts warn, could roll back years of progress in Nigeria’s financial inclusion drive.
The controversy erupted following the CBN’s announcement on February 11, 2025, that new ATM withdrawal fees would take effect from March 1. The apex bank, in a circular signed by Acting Director of the Financial Policy and Regulation Department, John Onojah, justified the move by citing rising operational costs and the need to improve the efficiency of ATM services.
Under the revised policy, withdrawals made from an individual’s bank ATM remain free. However, customers who use ATMs at the same bank’s premises will now be charged N100 per N20,000 withdrawal. Those using ATMs belonging to other banks face an even steeper cost, with an N100 fee plus a surcharge of up to N450 per N20,000 withdrawal at off-site locations.
The CBN defended the decision by pointing out that the last review in 2019 had reduced ATM withdrawal charges from N65 to N35, implying that banks have absorbed increased operational expenses for several years. However, the move has sparked backlash, with many arguing that it amounts to an unfair exploitation of consumers who are already struggling with economic hardship.
Many Nigerians have expressed frustration over the continuous increase in banking charges, particularly in light of the country’s worsening economic conditions. Rising inflation, stagnant wages, and increasing unemployment have left many struggling to afford basic necessities.
Impact on Financial Inclusion Efforts
The policy has also raised concerns about its impact on Nigeria’s financial inclusion goals. Over the past decade, the CBN has promoted financial inclusion as a key policy objective, working to bring more Nigerians into the formal banking system. Efforts such as mobile banking, agent banking, and simplified Know-Your-Customer (KYC) processes have aimed to reduce barriers to financial access, particularly for those in rural areas.
However, with this new policy, financial analysts warn that many low-income Nigerians may begin to avoid formal banking altogether to escape high transaction costs. Instead, they may turn to informal cash-handling methods, such as keeping money at home or using unregulated savings groups, which could expose them to security risks and financial instability.
Another concern is the possibility of increased reliance on Point of Sale (PoS) agents, who provide cash withdrawal services in communities with limited ATM access. PoS agents, who already charge withdrawal fees, may see an increase in demand as bank customers try to avoid direct ATM charges. However, this could also lead to higher PoS transaction costs as agents respond to rising demand by increasing their own fees.
With SERAP pushing for an interim injunction, the Federal High Court in Lagos is expected to set a date for hearing the motion. If the injunction is granted, it could temporarily halt the implementation of the ATM fee hike, offering relief to consumers.