The Reserve Bank of India (RBI) on February 8 in the bi-monthly monetary policy meeting announced that it is preparing a pilot project on QR Code based Coin Vending Machine (QCVM), which would eliminate the need for physical tendering of banknotes and their authentication.
This machine would dispense coins against a debit to the customer’s bank account using Unified Payments Interface (UPI).
It is also launched with an aim to promote distribution of coins and enhance the accessibility of coins, the RBI said during the bi-monthly monetary policy meeting.
If you aren't familiar with this development, here is an explainer for you to understand.
What is QR Code based Coin Vending Machine?
QR Code based Coin Vending Machine is a cashless coin dispensation machine which would dispense coins against a debit to the customer’s bank account using UPI.
The earlier machines had some flaws, due to this RBI has now come up with QR code based coin vending machine.
How it will work?
This machine will be like a normal coin vending machine, but here it will eliminate the need for physical tendering of bank notes and their authentication.
“Unlike cash-based traditional Coin Vending Machine, the QCVM would eliminate the need for physical tendering of banknotes and their authentication. Customers will also have the option to withdraw coins in required quantity and denominations in QCVMs,” RBI said in a release.
Why is it announced?
As per RBI, there were problems with the earlier machines wherein some fake currencies used to be fed to fetch coins.
It is also launched with an aim to promote distribution of coins and enhance the accessibility of coins.
“Coins we have a peculiar situation where the supply is very high. It is not getting properly distributed and at the same time there is demand in pockets. So, one way of increasing absorption of coins into the system is to make coins available in places where there is demand,” RBI Deputy Governor T. Rabi Sankar said during the post policy press conference.
He further added that earlier there were coin vending machines, where customers used to feed in cash and get coins. But, the problem then was the currency that was being fed in to these machines were very often fake and that was an issue and RBI could not be checked at that point of time.
Where it will be available for public?
The central bank will work in collaboration with a few leading banks for the pilot launch, as per the release.
The pilot project is planned to be initially rolled out at 19 locations in 12 cities across the country.
These vending machines are intended to be installed at public places such as railway stations, shopping malls, marketplaces to enhance ease and accessibility.
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