ATM usage declines in India..

The overall numbers have risen but averages are falling as suggested in this article.

Despite the number of (ATMs) and the in the system having risen in recent years,the number of average daily transactions on each has been consistently coming down.

This is despite the number of ATMs and of debit cards in the system having risen consistently. If the trend continues, experts said, sustainability of such devices will be an issue.

According to the (Catmi), between December 2012 and December 2014, the number of these machines rose from 105,784 to 176,410. However, in the same period, average daily transactions fell from 137 to 108, a decline of 21 per cent. This came as issuance of debit cards rose from 314.4 million to 500 million.

Those in the segment say the average transaction per ATM has fallen because the expectation with which the numbers were expanded hadn’t happened. “A couple of years before, banks had anticipated that Direct Benefits Transfer (DBT, of subsidy or welfare payments by the government) would begin flowing into the accounts and more people will be transacting via debit cards. That didn’t happen. With a focus on improving card penetration in the hinterland, ATMs were set up in remote areas but card acceptance there hasn’t also happened as anticipated,” said Amit Tyagi, secretary at Catmi.

Bankers also say better infrastructure in terms of point of sales (PoS) terminals, increased card usage on the online medium and the rise of digital banking has meant a reduction of card usage.

“We’re moving from cash to card as an economy, though it is still nascent. For a lot of things like recharge, shopping, etc, the payment is made only online. Even for small requests like a mini statement, cheque book request, etc, can be done either on the internet or mobile,” said another banker.

This is unexpected actually. One would imagine ATM usage to rise exponentially given how nascent our card economy is.It is particularly problematic for all these non-bank ATMs set up to make profits from this activity..

One Response to “ATM usage declines in India..”

  1. Billu Says:

    How is this unexpected if the banks start charging Rs. 20 after just 8 transactions?

    Earlier I used to withdraw 200 rupees per transaction, but now I withdraw 600 to 800 per transaction, the number of transactions are bound to go down.

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