Change is coming: Why RBI wants more Rs 100, Rs 200 notes in ATMs

Regulator seeks to help people in having cash for small purchases though digital financial transactions are growing

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The Reserve Bank of India (RBI) earlier this week asked banks and White Label ATM (WTA) operators to load at least one cassette of Rs 100 / Rs 200 notes in 75 per cent of ATMs by September 30 and 90 per cent by March 31 next year.

 

WLAs are automated teller machines managed and operated by non-banking entities, as mandated by RBI norms. “By mandating regular dispensing of Rs 100 and Rs 200 notes, the RBI aims to smooth out the perennial chhutta [small change] crunch — but it also raises fresh questions around convenience and digital adoption,” says Vineet Kumar, senior associate at SKV Law Offices.

 

The RBI’s direction this should lead to:

 

• Help people have cash for small purchases and reduce the need for larger currency notes. 
• Support micro-merchants who often struggle to provide change.

Convenient but not always 

“‘Small purchase’ is a relative term,” Vineet notes. “Carrying 150 or 200 of Rs 100 notes for a Rs 15,000 expense is unwieldy; carrying 30 or 40 of Rs 500 notes is far more manageable.” said Kumar. He highlighted the points mentioned below.

 

Withdrawal frequency: You may have to visit ATMs more often to get small notes, potentially pushing you past your free‐withdrawal limit (three in metro cities, five in non-metros).

 

Physical bulk: Bundles of small notes can be as cumbersome as handling larger ones, likely nudging consumers toward digital transactions.

Operational hurdles on the ground

 

NPCI manages the network of ATMs in India and according to the date published by it there are more than 2.6 lakh ATMs.

 

Reaching these targets nationwide entails:

 

• Cassette reconfiguration across tens of thousands of machines.
• Rapid logistics to replenish small-note supplies daily.

 

“As things stand, cash-outs happen regularly,” says Kumar. Temporary “dry ATM” spells could spike if banks and operators don’t coordinate closely.

 

Balancing cash and digital

 

Will easier access to small notes tempt you back to cash?

 

Or will the convenience of digital payments still win out?

 

Your choice will hinge on factors such as: transaction fees, bulk versus convenience, and personal preference.

   

What you can do

 

• Plan withdrawals smartly to stay within free-use limits. 
• Carry a mix of small and large notes to suit different purchase sizes. 
• Keep digital options ready, UPI, wallets or cards, if ATMs run out of cash.