The Reserve Bank of India (RBI) made a move on Thursday (March 7) to relax the rules for white-label ATM operators, enabling them to purchase wholesale cash from the bank.
According to a report citing the RBI, under the relaxed rules, white-label ATM operators can purchase cash from any bank in the country, including cooperatives and regional banks. These ATM providers are owned and operated by non-bank companies on behalf of the banks.
The RBI made the move after a review of the white-label ATM operators’ businesses, and determined the necessity of allowing them to buy wholesale cash of any denomination from the Reserve Bank. They can also source cash from any banks and offer bill payment and Interoperable Cash Deposit services.
The report noted that the Reserve Bank of India will also allow white-label ATM providers to display ads unrelated to financial products and services anywhere on the machine, including the screen. Ads are prohibited from appearing on the signboard.
“It shall be ensured that the advertisements running on the screen disappear once the customer commences a transaction,” the RBI said. “Further, banks may issue co-branded ATM cards in partnership with the authorized WLA operators, and may extend the benefit of ‘on-us’ transactions to their WLAs as well.”
The move comes as cash is still alive and kicking in the country, despite a move on the part of the government to embrace digital currency. According to a recent report, last year ended with scores of people in India still using cash as their preferred payment method. That is raising concerns, as there are expectations that close to 50 percent of ATMs in the country could be shut down in about a year due to rising operational costs and additional regulations.