Tag: More touchpoints

With the number of Pradhan Mantri Jan Dhan Yojana (PMJDY) Accounts swelling to 43.81 crore and direct benefit transfers (DBT) increasing with every passing year, banks will need to ramp up their touchpoints, especially in the hinterland, so that customers can easily withdraw their money, say ATM industry players.

The outstanding balance in PMJDY accounts as on November 3, 2021 was at ₹1,48,935 crore. Further, about ₹5.50-lakh crore was transferred digitally under various direct benefit transfer (DBT) schemes during 2020-21.

“So, lot of money is coming into the banking system. What this means is that with all the PMJDY accounts and DBT, people will access their money from either ATMs or bank branches,” said Ravi B Goyal, Chairman & Managing Director, AGS Transact Technologies.

Cash in circulation

He observed that cash in circulation (CIC) has increased to around ₹ 29-lakh crore now from the pre-demonetisation (2016) level of around ₹18-lakh crore. And CIC, which includes notes in circulation, rupee coins and small coins, is increasing.

“CIC basically is either dispensed through bank branches or through ATMs. Now, for a bank, if a customer walks into the branch, it costs them approximately ₹60, whereas if a customer goes to an ATM, it costs banks around ₹ 17,” Goyal said.

According to Ken Research, ATM penetration in India is very low at 15.4 ATMs per lakh population vis-a-vis 70.4 for China, 79.2 for the UK, 79.7 for Brazil and 90.3 for Russia.

The total number of ATMs in the country stood at 2.41 lakh as at August-end 2021 against 2.33 lakh as at August-end 2020.

“ATMs are a vital cog for dispensation of cash across the country. They further the cause of financial inclusion. Hence, the impediments to their expansion in the form of penalty of ₹10,000 for cash outs beyond 10 hours per ATM need to be suitably addressed, considering that there are cash logistics challenges, especially in rural and semi-urban locations,” according to the CEO of a white label ATM operator.