The Reserve Bank of India (RBI) has set up a committee to review the fee structure for white-label ATMs (WLAs). This committee will evaluate current policies and practices, aiming to recommend a fair and sustainable model that balances the interests of all stakeholders. An assessment will be done on fee structure, existing ATM infrastructure and international best practices The committee will submit its report to deputy governor T Rabi Sankar.
As per industry estimates, India's ATM market is expected to grow at a CAGR of 9.2% from 2024 to 2032. The committee, headed by Indian Banks' Association chief executive Sunil Mehta, has representation from the National Payments Corporation of India (NPCI), And leading banks and other stakeholders, including ATM manufacturers. At present, four authorised non-bank entities are operating white-label ATMs in the country.
The biggest challenge is the interchange fee, which is currently the same for both bank-operated ATMs and WLAs," said an industry executive. Adding that with increased digital banking, the transactions at ATMs have declined, which is making operations unsustainable. "Besides, most WLAs operate in rural areas where transactions are low as compared with urban areas," he added. The interchange fee is around '17 for a financial transaction and '6 for a non-financial transaction. Adding that with increased digital banking, the transactions at ATMs have declined, which is making operations unsustainable.
"Besides, most WLAs operate in rural areas where transactions are low as compared with urban areas," he added. The interchange fee is around '17 for a financial transaction and '6 for a non-financial transaction. Earlier, WLAOs had suggested a revision of the interchange fee for financial transactions to up to '30 and for non-financial transactions to '10. An RBI committee was set up in 2019 to review the ATM interchange fee structure and customer ATM usage charges at stipulated intervals by RBI.
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