Currently in India only Banks are allowed to open ATMs to serve their customer needs. It is felt that current ATM penetration is to Tier-I and Tier-II cities only. To move ATM services to other parts of India, RBI came up with guidelines to open White Label ATMs. It is in the right motive to provide Banking Services to anytime and anywhere concept. Let us see some features of this facility and how this facility can add value to your banking service.
Under RBI guidelines any non-banking entity is allowed to open White Label ATMs, which is registered under companies act of 1956. They will provide the banking services to the customers of banks in India, based on the cards (debit/credit/prepaid) issued by banks. Their role would be confined to acquisition of transactions of all banks’ customers and hence they would need to establish technical connectivity with the existing authorised shared ATM Network Operators /Card Payment Network Operators.
Now let us look at the service features which are adding more values to your banking transactions.
1) Currently only card issued by banks in India would be permitted to be used.
2) Acceptance of deposits like your banks, are not allowed by White Lable ATMs.
3) They would be permitted to display advertisements and offer value added services as per the regulations in force from time to time.
4) But such advertisements will disappear once customer commences transactions.
5) The extant guidelines on five free transactions in a month as applicable to bank customers for using other bank ATMs would be inclusive of the transactions effected at the White Label ATMs.
6) White Lablel ATMs are not allowed to collect any fee from customers directly. But they can charge fee to banks for using their ATM resources from their customers.
7) White Lable ATMs would not be entitled to any fee from the card issuer-bank other than the “Interchange” fee payable to “acquirer” bank under the bank owned ATM scenario.
8) The same guidelines for failed transactions rules will apply to these ATMs too. But it may take lengthy process to settle, as in current Banking ATMs, only the ATM bank where your failed transaction happened and the Bank with which you have account are the parties. But in case of White Label ATMs three players service involved those are operator of such ATMs, sponsor of such ATMs and your Bank. But let see how in future RBI will resolve this issue.
9) So for the above case even in White Label ATM system your bank have responsibility to settle such failed transactions.
10) No clarity as of now regarding the penalty for late settlement of failed transactions in these ATMs.
Overall it looks big relief for banks too as they felt setting of new ATMs means more investment. For customers it is good move to have access to their banking facility anytime and anywhere. Let us see how this service will unfold in India.