Background of the Study

As credit union branches closed in response to the COVID-19 health crisis in March and April, members’ primary interaction with credit unions was occurring either via the drive-thru or the ATM. “People felt safe using an ATM because there was no physical contact with a teller and they were able to maintain social distancing,” Terry Pierce (2020).

An automated teller machine (ATM) is an electronic banking outlet that allows customers to complete basic transactions without the aid of a branch representative or teller. Anyone with a credit card or debit card can access cash at most ATMs.

ATMs are convenient, allowing consumers to perform quick self-service transactions such as deposits, cash withdrawals, bill payments, and transfers between accounts. Fees are commonly charged for cash withdrawals by the bank where the account is located, by the operator of the ATM, or by both. Some or all of these fees can be avoided by using an ATM operated directly by the bank that holds the account.

ATMs are known in different parts of the world as automated bank machines (ABM) or cash machines.

The advert of the novel coronavirus COVID-19 which saw the whole world in lockdown and limited physical appearance at various banking halls has increased various online transactions. The virus has shown that the world has evolved into a global village and the banking sector is not left out. Information and digital communication technology (ICT) has increasingly stirred the expansion of the banking networks and range of the services offered in recent times. Most of banking transactions, such as electronic payments, loans, deposits, or securities have become highly dependable on information and telecommunication technology (Adewoye, 2013)

The Central Bank of Nigeria (CBN) has recently engaged in series of reformations aimed at both strengthening Nigerian financial system and enhancing the overall economic performance of Nigeria to place it on the right path in tune with global trends. Cashless policy is one key reform introduced in Nigeria financial system. The policy is a new policy on cash-based transactions which specifies a ‘cash handling charge’ on daily cash withdrawals or cash deposits that surpass N500, 000 for Individuals and N3, 000,000 for Corporate bodies. The policy aims at reducing not eliminating the quantity of physical cash circulating in the country, and encouraging further electronic-payment systems in Nigeria (CBN, 2012). The cashless policy has birthed numerous electronic payment channels the commonly used epayment machinery in the country are Automatic Teller Machine (ATM), Point of Sale Terminals (POS), Mobile Money Transfer (MMT), and Online Money Payment (WEB) (Okoro, 2014)

The essence of the electronic banking reform was to promote a comprehensive process of substantially improving the regulatory and surveillance framework, promoting sound competition in banking services, assuring an organized structure for monetary management, increase in savings mobilization, reinforcement of capital adequacy, encouragement of investment and development through market-based interest rates, expanding elegance of the world financial products, and even the recent global financial crisis, all make the need for banking sector reforms a sine qua non, but the challenges of insecurity and inadequate infrastructure are still persistent.


Even before the coronavirus pandemic, financial institutions were working to align digital and physical touchpoints with the desires of customers. But in our new reality of both economic calamity and limited interpersonal contact, banks are facing a real-time, wholesale shift in distribution channels. The stakes of getting these accelerated changes right is more necessary and challenging than ever./ COVID-19 has accelerated branch transformation. Banks can’t give up on physical presence, but they also need a way to manage that presence cost-effectively. Using established third-party ATM networks can be an alternative to consider for broad access while freeing capital and strategic mindshare to focus on today’s COVID-19 crisis and tomorrow’s digital transformation needs.

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