Back for the money

More than seven years after demonetisation, automated teller machines are in the spotlight, reports RAGHU MOHAN

- RAGHU MOHAN

State Bank of India (SBI) has floated a request for proposal for 16,000 automated teller machines (ATMs), the largest such by a bank in the country. Plus, another 17,500 for outsourcing.

Keeping SBI company on this front are Bank of Baroda (7,400) and Punjab National Bank (3,500). Taken together, fresh orders for ATMs over the last six months total 44,500, or nearly six-fold of what was placed in the preceding period. "While about 20,000 are replacements for ageing ATMs, it's still a bonanza," says Stanley Johnson, executive director, AGS Transact Technologies, which manufactures ATMs. Why so? "Because the installed ATM base in November 2016 was around 225,000; it's now at 260,000." The numbers dialled for are more than what has been set up since.

There are stirrings in the whitelabel ATM (WLATM) - those set up, owned and managed by companies other than banks - business as well.

One deployer has crossed the 10,000 mark (Indial Payments at 13,047) and while another, Hitachi Payments, has hit 10,000. This is seen as an achievement despite the fact that Mint Road's June 2012 WLATM policy did not deliver the way dedicated tower companies did for mobile telephony.

Had it gone to plan, 1,00025,000 ATMs would have been set up by an operator in the very first year of operations (based on the scheme it had opted for). If all eight that had signed up had set it rolling, these numbers would have been at 8,000-200,000.

But the idea did not fire the way it was imagined: We have just 34,074 WLATMs after more than a decade.

"Our average penetration levels are way below compared to the world, at about 21 ATMs per 100,000 population. If you take China and Brazil, they are in the 80s and 90s," says K Srinivas, managing director (MD) and chief executive officer (CEO) of Indial. Yet he sounds optimistic.