ATMs ...........USES, UNDER USES & MISUSES

ATMs are not new addition in banking technology in India. But it is new to very remote locations in far off villages. RBI made it more simpler than ever before. With the new directives any ATM card holder of any bank can use ATM of any bank that too free of cost to customer. The customers of banks who had very limited network of ATMs started making v lines in front of ATMs of other banks. On behalf of the customers their banks were required to pay Rs 20 per withdrawal. It was a win win situation for the customers. But customers of the Banks who had created large network for their own customers, were in difficulties because of huge crowds. This position also reduced the gap of large and small banks in terms of ATM network and the advantage of large ATM network available to few banks like SBI was marginalised. a few banks stopped installing fresh ATMs in as much as paying the cost of customer's ATM transaction is still cheaper than the cash transaction at the branch. But some Bank, At the same time, with smaller ATM network also started suffering losses on account of huge payouts owing to withdrawals made by their customers. Their profitability is affecting.

The situation again reviewed by the RBI and on the basis of recommendations of IBA, a few restrictions have been imposed . These are maximum withdrawals of Rs 10000/ and that too maximum five times. But still there is long ques in front of ATMs.

The huge crowds in front of the ATMs is welcoming feature. The public is testing, experimenting and enjoying with this technology. It is of great use and this is an important happening as it has migrated the customers on alternate delivery channel there by reducing crowds at the counters in branches. But the availability of ATMs is still a problem. The number of ATMs are still insufficient to number of cards. This channel needs to be further strengthened to reduce the customer interface at the counters.

The ATMs are for so many uses but they are primarily used for cash withdrawals which is the under utilisation of the Machine. The other function like online ticketing, railway/ bus reservation, school fee, money transfer in the accounts etc are yet to be fully used. The increase in number of ATMs will reduce the crowds and then only other operations will pick up. The banks need to install more number of ATMs at one place to reduce their operational cost as also the customer inconvenience.

The customers too are not using their cards at point of sale for shopping instead are paying cash due to obvious reasons which need to be encouraged in order to reduce the pressure on ATMs as also to reduce the usage of cash.