The Central Bank of Nigeria (CBN) has released a draft guideline aimed at reducing banking charges and making borrowing costs more transparent for consumers.
The proposed framework, unveiled in a circular by the apex bank and titled “Guide to Charges by Banks and Other Financial Institutions, 2026,” represents the most comprehensive revision of banking fee regulations since the existing guide was first issued in 2020, and its implications, if enacted, will be felt by millions of Nigerians who interact with the banking system daily.
At the heart of the new proposal are strict caps on electronic transfer charges, a sore point for many Nigerians who have long complained about the cumulative burden of fees on routine transactions.
Under the draft rules, transfers between N5,000 and N50,000 will attract a maximum charge of just N10, while any single transfer above N50,000 will be capped at N50.
For context, those figures represent a meaningful departure from the sometimes opaque and varied charges that different institutions have historically levied on customers, often with little consistency or justification.
In a country where mobile banking and electronic transfers have become the primary means of financial transactions for millions, particularly in the wake of the 2023 cashless policy push, the significance of this change cannot be overstated. Small business owners, market traders, and everyday Nigerians who send money multiple times a day stand to benefit most directly.
The CBN’s proposed guide also takes aim at ATM withdrawal fees, which have been a recurring grievance among bank customers for years.
Customers who use another bank’s ATM located on a bank’s premises will now pay a flat fee of N100 per N20,000 withdrawn. However, for ATMs situated off-site, such as those found in shopping malls, fuel stations, and open markets, financial institutions may apply an additional charge of up to N500 per N20,000 withdrawn, reflecting the higher operational cost of maintaining machines in remote locations.
Critically, withdrawals made from a customer’s own bank’s ATM will remain unaffected by the new charges, offering some relief to customers who have access to their own bank’s machines.
Industry analysts are likely to welcome it as a boost to Nigeria’s digital economy. The CBN has also proposed a cap on merchant service charges, the fees businesses pay when customers make card or digital payments at point-of-sale terminals.
The new ceiling is set at 0.5 percent per transaction, with an absolute maximum of N10,000 regardless of transaction size. This provision is expected to reduce the cost burden on businesses, particularly small and medium-sized enterprises, that have often struggled with high charges eating into already thin profit margins. Ultimately, lower merchant costs translate into a better deal for end consumers as well.
Perhaps the most far-reaching element of the proposed guideline is its directive on lending transparency. The CBN has mandated that all lending costs must henceforth be expressed using the Annual Percentage Rate (APR) system, a standardized measure that bundles interest rates and all associated fees into a single, clear figure.
This is a direct response to widespread concern that Nigerian banks and financial institutions have historically obscured the true cost of credit behind a maze of administrative charges, processing fees, and insurance levies that borrowers often discover only after signing on the dotted line. By requiring a single, all-inclusive APR disclosure, the CBN is effectively compelling lenders to show their hand upfront.
For individuals seeking personal loans, SMEs seeking working capital, and even large corporates refinancing debt, the shift to mandatory APR disclosure could fundamentally alter how borrowing decisions are made in Nigeria.
The CBN was direct in its reasoning. The regulator acknowledged that the current 2020 guide has grown outdated in the face of rapid changes within Nigeria’s financial landscape, changes driven by the rise of fintech, the expansion of digital banking, shifting macroeconomic conditions, and evolving consumer behavior.
The updated framework, according to the bank, is also designed to create space for financial innovation while simultaneously strengthening institutional accountability. In other words, the CBN appears to be signaling that growth in the sector and consumer protection are not mutually exclusive goals—and that it intends to hold banks to that standard.
The guideline is currently in draft form, meaning stakeholders, including banks, fintech companies, consumer advocacy groups, and members of the public, may still have an opportunity to weigh in before it is finalized. The CBN has not yet announced an official implementation date.
Nonetheless, the direction of travel is clear. After years of consumer complaints about exploitative charges and the opacity of loan terms, Nigeria’s apex bank appears ready to draw a firm line—and the banking sector would do well to prepare accordingly.
WHAT YOU SHOULD KNOW
The Central Bank of Nigeria’s proposed 2026 banking charges framework is fundamentally about one thing: putting the Nigerian consumer first.
By capping electronic transfer fees, regulating ATM charges, limiting merchant service costs, and mandating full loan cost transparency through the APR system, the CBN is sending a clear message to financial institutions: the era of hidden charges and unclear lending terms must come to an end.
If implemented as proposed, everyday Nigerians, small business owners, and borrowers stand to save more, spend smarter, and make better-informed financial decisions.
