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50% ATMs across India to shut down by March 2019: CATMI

The move would put a severe impact on both urban and rural population. Currently, India has approximately 238,000 ATMs installed out of which 100,000 off-site and more than 15,000 white label ATMs, are expected to shut down.

Shobhit Kalra

Shobhit KalraBy Shobhit Kalra

Published on 21 Nov 2018 2:57 PM GMT

50% ATMs across India to shut down by March 2019: CATMI
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New Delhi: CATMI, the apex body of the domestic ATM industry, on Wednesday, said that around 1,13,000 Automated Teller Machines (ATMs) across India may be forced to shut by March 2019 on account of non-viability of operations.

The move would put a severe impact on both urban and rural population. Currently, India has approximately 238,000 ATMs installed out of which 100,000 off-site and more than 15,000 white label ATMs, are expected to shut down.

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CATMI said that long queues and chaos outside ATMs, what was witnessed post demonetization, could be a situation once again in India.

"This would severely impact millions of beneficiaries under the Pradhan Mantri Jan Dhan Yojana who withdraw subsidies in form of cash through ATMs, besides urban centres, resulting in snaky queues and chaos akin to post-demonetisation," CATMi Director V. Balasubramanian.

He said the CATMi step is forced on account of recent regulatory guidelines for ATMs hardware and software upgrades, recent mandates on cash management standards and the Cassette Swap method of loading cash, entailing huge investments by the industry.

In April this year, the Reserve Bank of India (RBI) imposed stringent guidelines for ATMs service providers or their contractors followed by the Union Ministry of Home Affairs issuing similar directives vide gazette notification to be implemented by February 9.

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These include a minimum net worth requirement of Rs 100 crore, minimum fleet size of 300 fully-equipped cash vans, two custodians and two armed guards plus a driver, GPS-CCTV, and later in June came the diktat for upgradation of the software from WindowXP to Window10.

"To implement all these security, software-hardware directive would entail an additional cost of minimum Rs 150,000 per ATM per month. This works out to astronomical figures for all the 238,000 ATMs in the country," Balasubramanian pointed out.

"However, the RBI-MHA directives are to be implemented by the banks which must bear the costs, but they are not willing to discuss the issue, leaving us to fend for ourselves. Accordingly, from January onwards, we shall progressively start shutting down the ATMs," he said.

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India, however, has among the lowest ATM penetration globally, averaging 8.9 ATMs per 100,000 population, compared to Brazil's 119.6, Thailand's 78, South Africa's 60 and Malaysia's 56.4.

Shobhit Kalra

Shobhit Kalra

Writer has 10 years of experience in digital media. Presently working as Chief Sub Editor at newstrack.com. An avid reader and always willing to learn new things and techniques.

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