Beena Parmar Moneycontrol News
A shortage of supply, high costs and the time taken to recalibrate ATMs have together resulted in the Rs 200 note being kept away from ATMs, according to bankers and ATM operators.
After the Reserve Bank of India issued directions to do so, bankers said that the new yellow-coloured Rs 200 notes may start getting dispensed from most ATMs in the next 2-3 months. Introduced in August last year, the new currency notes are not widely available with the public, pushing RBI to ask banks to start dispensing these notes from their ATMs.
However, bankers have complained of not having enough availability of the new currency notes themselves and that the recalibration process would mean added costs for banks to bear. "Supply is an issue. There aren't enough notes for us to deploy at ATMs, We have asked RBI to increase the supply," said a senior State Bank of India official.
According to the official, the supply of Rs 200 notes is not enough except in states like Maharashtra and Bihar. Supply in Tamil Nadu and Madhya Pradesh is getting reasonable with time. "There are also recalibration costs and there have to be at least two people to physically go to the ATM and recalibrate the cassettes," the official said.
According to industry experts, the overall recalibration process may cost banks Rs 100-120 crore. Neeraj Vyas, Deputy Managing Director and Chief Operating Officer at SBI, said, "We have started dispensing the new 200 rupee notes at around 8,000 ATMs and should finish the rest of the ATMs by January end."
"The 200 denominations supply has to be taken care of. Banks have come to us asking us to calibrate the cassettes of Rs 200 notes so wherever there is supply, we have started doing it," Radha Rama Dorai, Managing Director of ATM and allied services at FIS recently told Moneycontrol.
There are nearly 2.4 lakh ATMs in the country, including close to 30,000 cash recyclers. A cash recycler machine can both dispense and accept cash. Each ATM has four cassettes, of which two are exclusively meant to dispense either Rs 100 or Rs 500 currency notes depending on the demand at that location. The other two are calibrated to dispense Rs 2000 notes, in addition to Rs 100 and Rs 500 notes.
For the new Rs 200 notes to be dispensed, the process requires an engineer to visit each ATM location and recalibrate one of the cassettes to accommodate them.
Navroze Dastur, managing director at NCR Corporation, which operates almost half the ATMs in the country, said, "The primary reason RBI wants banks to push 200 rupee notes is that current ATMs have large chunk of 100, 500 and a few 2000 notes. Hence the average ticket size of withdrawal has increased.”
"RBI also wants the 200 rupee notes to be faster into circulation, and the only fastest way for circulation cannot be done through branches but through ATMs,” he said. NCR Corp has recalibrated 1000-odd ATMs for the top 5-6 banks but even that is a miniscule figure when compared with the total number of ATMs.
Dastur said that supply and costs do not seem to be an issue. "I don't see supply issue but we need to physically visit the ATMs. Also during demonetisation, there was an urgency, now there is no stress so it can be done systematically and we can finish the recalibration in 90-120 days. The costs are one third of what banks are quoting."
As per reports, a banker has stated costs to be around Rs 1,000 crore. Banks are also looking at redeployment of existing ATMs to more transacting locations and replacing old and obsolete ATMs with new ones. On an average an ATM needs to be replaced in 7-8 years.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
