The Central Bank of Nigeria (CBN) has once again chosen the lazy path of revenue generation—squeezing the pockets of everyday Nigerians under the guise of “reviewing ATM transaction fees.” With the new policy set to take effect on March 1, 2025, withdrawing cash from an ATM will attract not only a ₦100 charge per ₦20,000 but also an outrageous surcharge of up to ₦500 for using an ATM not owned by one’s bank. This blatant cash grab comes at a time when Nigerians are already suffocating under rising inflation, stagnant wages, and a failing banking system that barely provides the services it charges for.
A Nation Over-Taxed and Under-Developed
If over-taxation led to prosperity, Nigeria would be an economic powerhouse by now. Yet, year after year, the government and its agencies resort to taxing the poor while failing to fix the systemic inefficiencies that cripple economic growth. The idea that increasing transaction fees will make banking services more efficient is laughable. What it actually does is discourage financial inclusion, forcing more Nigerians back into cash transactions, thereby weakening the very digital economy the government claims to promote.
Meanwhile, countries like the United Arab Emirates (UAE), Qatar, and Monaco have shown that excessive taxation is not a prerequisite for national development. The UAE, for instance, operates a largely tax-free economy, attracting global investments, fostering entrepreneurship, and ensuring a high standard of living. Instead of punishing citizens with outrageous levies, the UAE prioritizes business-friendly policies, infrastructure development, and ease of doing business, which, in turn, boosts economic growth and government revenue.
A Misguided Approach to Economic Reform
Nigeria’s economic managers have repeatedly shown a disturbing inability to generate revenue through productivity rather than taxation. Instead of focusing on fixing the failing power sector, decaying infrastructure, or rampant corruption in government agencies, they opt for the easiest option: burdening the masses with new financial obligations.
Renowned economist Milton Friedman once said, “The way you solve things is by producing more, not by taxing more.” Yet, Nigerian policymakers seem to believe that economic prosperity can be achieved by extracting more from a population that is already on its knees.
The Way Forward: Real Solutions, Not More Burdens
If the CBN is truly committed to improving banking efficiency, here are better alternatives than extorting citizens through ATM charges:
1. Invest in Digital Banking Infrastructure – Encourage seamless, fee-free digital transactions instead of forcing people to use costly cash withdrawals.
2. Improve Financial Inclusion – Provide incentives for banks to expand services to rural areas instead of making banking more expensive.
3. Cut Government Waste – Redirect funds wasted on political excesses into economic reforms that genuinely uplift Nigerians.
4. Encourage Local Production and Exports – Reduce reliance on oil by supporting industries that create wealth and employment.
Conclusion
The CBN’s new ATM charges are a regressive tax on the poor, plain and simple. Instead of fixing the real problems plaguing the banking sector, they are doubling down on policies that make life harder for Nigerians. If the goal is economic growth, then Nigeria must learn from successful economies that prioritize wealth creation over wealth extraction. The government must abandon this anti-people policy before it pushes more Nigerians into financial exclusion and deepens the economic hardship that is already unbearable.
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