Banks shutting ATMs amidst govt's cashless push: report
28 October 2017
Banks have closed about 358 ATMs across the country between June and August this year, reversing the earlier trend of installing more cash vending machines amidst the government's push for cashless transactions.
According to a Reuters report, the diminishing number of ATMs could be directly related to the Narendra Modi government's move to make the country a less-cash economy ever since the demonetisation of the Rs500 and Rs1,000 notes on 8 November last year
While the growth in the number of ATMs have been reversed, there has also been a simultaneous increase in the number of online transactions ever since the demonetisation drive, limiting the need to increase the number of ATMs, says the report.
Also, with fewer customer accessing the ATMs, banks may find it rather costly to operate the kiosks, considering the high installation costs and rents, especially in metros. Additionally, banks also have to take care of costs such as salaries of security personnel, electricity bill, and other maintenance expenses.
According to a report in The Times of India, State Bank of India has closed several ATMs after merging with associate banks. SBI had 59,291 ATMs in June this year and the number came down to 59,200 in August. Similarly, the number of ATMs of Punjab National Bank came down to 10,083 from 10,502 while that of HDFC Bank to 12,225 from 12,230.
"We had to decide whether the footfall at an ATM justified its running costs. Most of the ATMs we shut down were at places where another SBI parent or associate bank ATM was within a 500-metre radius. Our customers will not be greatly inconvenienced because of this," an SBI official told the daily.
Although not all banks are cutting down on ATMs, many have said they may not be expanding their ATM networks anytime soon.
Meanwhile the reports of ransomware attacks on ATMs have affected many systems across the world and the RBI has directed banks to operate their ATMs only after updating the software.