RBI Sorts out Cash­less ATMs Is­sue

The cen­tral bank in­ter­vened af­ter re­ceiv­ing re­ports that many banks were hoard­ing cash

The Economic Times - - Finance & Commodities - Pratik.Bhakta@ times­group.com

Mum­bai: The Re­serve Bank of In­dia had to step in to en­sure that banks dis­trib­uted suf­fi­cient money through their ATM net­work af­ter sev­eral com­plaints of cash­less ATMs came to their at­ten­tion. This was de­spite the fact that suf­fi­cient funds were al­lot­ted to the re­spec­tive bank branches to be dis­trib­uted through ATMs. Af­ter many companies, which man­age the 2 lakh strong ATM net­work of the coun­try, started com­plain­ing about banks hoard­ing cash, the RBI started seek­ing de­tailed re­ports from these companies on how much cash was be­ing re­quested by each bank and how much was be­ing re­leased by banks.

“RBI in­ter­vened af­ter banks were found hoard­ing cash. They were ask­ing re­ports from banks and all of the other stake­hold­ers,” said Anand Garollu, In­dia ser­vices gen­eral man­ager, NCR Cor­po­ra­tion, which is one of the largest mak­ers and man­agers of the cash dis­penser in the coun­try.

Garollu said that since the com­pany is re- spon­si­ble for load­ing cash into ATMs they know the de­mand and are re­spon­si­ble for rais­ing in­dents with the re­spec­tive banks on how much cash is needed to re­plen­ish ATMs. “We raise the in­dent and are aware of how much we are re­ceiv­ing from banks against the in­dents. We send re­ports daily to the RBI,” said Garollu.

Ex­plain­ing the root cause of the prob­lem, ATM in­dus­try in­sid­ers said that af­ter 86% of the cur­rency was sucked out post-de­mon­eti- sa­tion, banks were al­lot­ted lesser cash from their cur­rency chests be­cause of is­sues around print­ing of new notes, which forced them to hoard what­ever was avail­able to cater to their own cus­tomers at their branches. “Cash once re­leased in the ATM net­work could be ac­cessed by other bank cus­tomers as well. This had caused them to hold on to the cash they got,” said top ex­ec­u­tives of cash lo­gis­tics companies who are in­volved in ATM re­fill­ing.

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