White-Label ATM Networks Authorised in India
- The Reserve Bank of India has just agreed to banks’ demand to allow the setting up and management of ATM networks by third parties. Banks will no longer have to own the ATMs or make sure they are operational and they will be able to provide their customers access to self-service banking via non-banking companies.
- In India, ATMs could be installed by independent third parties but were all owned by banks; otherwise, white label automatons were not permitted.
- Debates have been going on for over two years; several institutions agreed to this evolution imagining it could help reduce costs by erasing the need for capital investments in installing large-scale networks.
- RBI has also released guidelines for permitting non-banking entities to set up, own and operate ATM networks. This documentation for instance aims at expressing networks’ ownership conditions and subsequent revenue sharing. From now on, in India, as in the US and in Europe (where Euronet and Star, for example, already propose these kinds of services), white label networks will be authorised to be set up and managed by non-banking third parties. As deployment costs will be lower for banks, this agreement might make it possible to increase the number of available ATMs and improve accessibility to banking services.
- RBI also reminds that about 87,000 ATMs are now available in India; nevertheless, despite very perceptible investment efforts in urban areas, rural regions still do not benefit from sufficient access to self-services banking.