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Reserve Bank decides to penalise banks for failing to timely replace currency notes in ATMs

  by NEWSNER , 2021-08-11 15:53:39


Reserve Bank decides to penalise banks for failing to timely replace currency notes in ATMs

 

The Reserve Bank, concerned about the annoyance caused to the public by the lack of cash in ATMs, has decided to penalise banks for failing to timely replace currency notes in such machines.

 

From October 1, 2021, forward, the RBI will begin levying penalties on banks if ATMs are out of cash for a total of 10 hours in a month.

 

"Cash-out at any ATM for more than ten hours in a month would attract a fixed penalty of 10,000/- per ATM," the RBI notification read, launching the "Scheme of Penalty for Non-Replenishment of ATMs."

 

"The Scheme of Penalty for non-replenishment of ATMs has been formulated to ensure that sufficient cash is available to the public through ATMs," the RBI said in a circular.

 

The Reserve Bank of India has the mandate to print banknotes, which the banks are carrying out by dispensing banknotes to the general people through their extensive network of branches and ATMs.

 

In this regard, it was noted that an assessment of ATM downtime due to cash-outs was conducted, and it was discovered that ATM operations affected by cash-outs result in the non-availability of cash, causing avoidable inconvenience to the general population.

 

As a result, the central bank has decided that banks and White Label ATM Operators (WLAOs) will improve their systems and methods to monitor cash availability in ATMs and ensure prompt replenishment to avert cash-outs.

 

"Any non-compliance in this regard shall be viewed seriously and shall attract monetary penalty as stipulated in the 'Scheme of Penalty for non-replenishment of ATMs'," the RBI said.

 

The Scheme will be effective from October 01, 2021.

 

On condition for counting instances of cash-outs in an ATM, the RBI said it would come into play "when the customer is not able to withdraw cash due to non-availability of cash in a particular ATM".

 

As regards the quantum of penalty, the central bank said "cash-out at any ATM of more than ten hours in a month" will attract a flat penalty of Rs 10,000 per ATM.

 

In the case of White Label ATMs (WLAs), the penalty would be charged to the bank, which is meeting the cash requirement of that particular WLA.

 

The bank may, at its discretion, seek reimbursement from the WLA operator for the penalty, it noted.

 

At the end of June 2021, the country had 2,13,766 ATMs from various banks.

 

Source: https://www.newindianexpress.com/

 

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