Mumbai: There is a mixed reaction to steps by Bank of India’s reserves (RBI) to punish RS 10,000 banks for each InTho instance that is not cash for 10 hours.
ATM operators (known in the industry as managed service providers, or MSP) and cash-in-transit companies throw their hands, stating that they will not bear punishment.
On the round to the bank this week, RBI said that they had to monitor the availability of cash in the ATM and ensure that there was no cash.
Circular said that the bank will be fined RS 10,000 if there is cash at any ATM for more than 10 hours a month.
“There is a certain location where the ATM runs out of money within hours after being loaded.
These machines may not be feasible to operate if there is a penalty every month,” said a senior executive at the MSP company.
There are 2,13,766 ATMs in this country, and most of them are managed by MSP that appointed a cash-in-transit company to fill currency notes on the machine.
According to MSP, the regulation intends well because they recognize cash roles in the economy and place responsibility for banks to ensure the availability of cash.
However, they said that the penalty was not well thought out because the Bank outsourced most of the work and treated regulations as something to be forwarded to MSP.
“While the intention behind this RBI circular is welcome, a penalty approach is not possible to solve the ATM currency blackout problem.
In fact, it is very possible that this penalty will be a pass-through, from the bank to MSP, and from MSKS to the cash logistics agent,” Rituraj Sinha said, the group implementing director at SIS, the largest security and cash company in India.
According to Sinha, what needs to be overcome is the root cause of ATMs that flow dry, such as sub-optimal cash forecasting and delay in the availability of ATM-FIT currencies.
“The on-ground implementation of circular RBI on April 2018 is a real solution, not only before better security but also more accurate cash forecasting and the availability of timely currency to enable cash logistics institutions to upload ATMs on time and with an adequate amount Currency, “he said.
Circular 2018 requires banks to place strict measures such as transporting cash in tapes, in vehicles prescribed sticking to government norms on the transportation of currencies during certain hours.
According to the bank, it is difficult to apply all these norms under current cost structure.