Now, non-bank entities can operate ATMs
The Reserve Bank of India (RBI) on Wednesday permitted non-banking companies to set up and operate automated teller machines (ATMs), the white-label ATMs (WLAs), to accelerate the spread of delivery channels.
WLAs are ATMs set up, owned and operated by non-bank entities incorporated in India under the Companies Act. Till now, only banks were permitted to set up ATMs.
The apex bank proposed three schemes. Under the first scheme, an operator has to set up 9,000 WLAs in three years. In the first year of operations, it'll have to roll out 1,000 units. For every three WLAs installed in Tier-III to VI centres, a WLA can be installed in Tier-I to -II centres. The operator will have to open twice the number of WLAs opened in the first year. For the third year, it will have to open thrice the number of units opened in the second year.
Under the second scheme, an operator has to install 5,000 units a year for three years. Under the third option, an operator has to set up 25,000 WLAs in the first year and another 25,000 in the next two years.
A minimum 10 per cent of the WLAs installed in Tier-III to -VI centres should be in Tier-V & -VI centres. This condition is applicable under all schemes.
A company planning to operate WLAs must have at least Rs 100 crore networth. Initially, only cards issued by banks in India (domestic cards) can be used at WLAs. Acceptance of deposits at WLAs by the operators would not be permitted.
Existing guidelines on five free transactions a month, as applicable to bank customers for using other bank ATMs, would be inclusive of transactions effected at WLAs.
WLA operators would not be entitled to any fee from banks other than the interchange fee payable to acquirer banks under the bank-owned ATM scenario.