RBI asks banks to grout ATMs to wall, floor for security by September-end

The Reserve Bank on Friday asked banks to ensure their ATMs are grouted to a wall, pillar, or floor by September-end, except those installed in high secured premises such as airports, to enhance security of the cash vending machines.
In 2016, the RBI had set up a Committee on Currency Movement (CCM) to review the entire gamut of security of treasure in transit.

Based on the recommendations of the panel, the central bank has now issued instructions aimed at mitigating risks in ATM operations and enhancing security.
As part of the security measures, all "ATMs shall be operated for cash replenishment only with digital One Time Combination (OTC) locks".
Also, "All ATMs shall be grouted to a structure (wall, pillar, floor, etc.) by September 30, 2019, except for ATMs installed in highly secured premises such as airports, etc. which have adequate CCTV coverage and are guarded by state/central security personnel".
Further, banks may also consider rolling out a comprehensive e-surveillance mechanism at the ATMs to ensure timely alerts and quick response, it said.
The new measures to be adopted by banks are in addition to the existing instructions, practices and guidance issued by the RBI and law enforcement agencies.
The RBI also warned the banks that non-adherence of timelines or non-observance of the instructions would attract regulatory action including levy of penalty.

Parliament panel asks RBI to fix dysfunctional ATMs, install more machines

A parliamentary panel has asked the Reserve Bank to address the problem of perpetually dysfunctional ATMs so as to avoid any situation of forced cash crunch.
The Standing Committee on Finance has also asked banks to install adequate number of ATMs. The panel tabled its report in Parliament last week.

As per a data of RBI, there were 2,21,492 Automated Teller Machines (ATMs) in the country as at September-end 2018.

These include 1,43,844 ATMs of public sector banks, 59,645 ATMs of private banks and 18,003 of foreign banks, payments banks, small fiance banks and White Label ATMs (WLAs), which are owned and operated by non-bank entities.
"As digital transactions have not become anywhere near universal, the committee would urge upon RBI to pursue the lingering problem of dysfunctionality as well as shortage of ATMs vigorously with banks, while ensuring the economic viability of ATMs for all stakeholders, so that a forced cash crunch is not imposed on the public," the report said.
The panel headed by senior Congress leader M Veerappa Moily also noted that RBI's remonetisation drive has not augmented/resolved the cash supply to ATMs in rural/semi-urban areas, forcing shutdown of many ATMs.
The committee has expressed concern that "there are just not enough" ATMs being installed or added to cater to the rising demand for cash in an expanding economy, even as more and more debit cards are being issued and large number of Jan Dhan accounts opened by banks.
ATMs have become an important channel for withdrawing money even after the close of banking hours. Digital transactions are also catching up.
Besides ATMs, basic banking services are provided by business correspondents through their micro ATMs.

Govt rubbishes report about PSBs shutting down ATMs for regulatory reasons

Public Sector Banks (PSBs) do not have any plans to shut down their ATMs, Minister of State for Finance Shiv Pratap Shukla informed Parliament.
The statement assumes significance amidst a report by the Confederation of ATM industry (CATMi) warning that nearly half of the 238,000 machines run the risk of closing down by March next year due to regulatory compliance changes making the business unviable due to rising costs and dipping or stagnant revenues.

As reported by the scheduled commercial banks, small finance banks, payment banks and white label ATM operators, 221,000 ATMs are deployed in the country as on September 30, Shukla said in a written reply to the Lok Sabha.
Apart from ATMs, banking services across the country are provided through bank branches, inter-operable business correspondents (BCs) with micro-ATMs etc, he said.
Further, he said, mobile banking services and various digital modes of banking facilities are also available in India.
Replying to another question, Shukla said the government announced recapitalisation of PSBs to the tune of Rs 2.11 trillion in October 2017, through infusion of capital by the government and raising of capital by banks from the markets.
ALSO READ: PSBs filed over 2,500 FIRs against wilful defaulters till Sept-end: Jaitley
PSBs meet their capital requirement through various sources including, inter alia, mobilisation of capital from the market through issuance of capital instruments and monetisation of non-core assets, internal capital generation including through recovery in written-off accounts, and capital infusion by the government.
"Rs 88,139 crore was infused by the government in PSBs during financial year 2017-18 after the recapitalisation announcement and provision of Rs 65,000 crore has been made in the budget for the current financial year for infusion," he said.
Since the recapitalisation announcement till November 2018, PSBs have been recapitalised to the tune of Rs 1.28 trillion through infusion and mobilisation of capital from the market, he said.

New safety rules may force 50% ATMs in India to close: Industry association

Nearly 50 per cent of the Automated Teller Machines (ATMs) may be shut down by March 2019 due to unviability of operations, hitting hard both urban and rural population, the Confederation of ATM Industry (CATMi) warned on Wednesday.
Currently, India has approximately 2,38,000 ATMs, of which around 1,13,000 ATMs including 1,00,000 off-site and more than 15,000 white label ATMs are expected to down their shutters, said a CATMi spokesperson.

ALSO READ: From today, you can't draw over Rs 20K a day at SBI ATMs: Things to know
"This would severely impact millions of beneficiaries under the Pradhan Mantri Jan Dhan Yojana who withdraw subsidies in the form of cash through ATMs, besides urban centres, resulting in snaky queues and chaos akin to post-demonetisation," said the spokesperson.
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.
ALSO READ: 64% not happy with SBI move to cap ATM withdrawal at Rs 20,000: BS poll
The measure will also result in huge job losses in the industry that would be detrimental to financial services in the economy as a whole.