The Reserve Bank of India (RBI – the apex bank ) will impose a monetary penalty under the “Scheme of Penalty for non-replenishment of ATMs” effective from October 01, 2021. Cash-out at any ATM of more than ten hours in a month will attract a flat penalty of ₹ 10,000/- per ATM. Read the full circular.
DCM (RMMT) No.S153/11.01.01/2021-22
August 10, 2021
The Chairman /
Managing Director & CEO
Dear Sir / Madam,
Monitoring of Availability of Cash in ATMs
As you are aware, the Reserve Bank of India has a mandate to issue banknotes and the banks are fulfilling this mandate by dispensing banknotes to the public through their wide network of branches and ATMs. In this connection, a review of downtime of ATMs due to cash-outs was undertaken and it was observed that ATM operations affected by cash-outs lead to non-availability of cash and cause avoidable inconvenience to the members of the public.
2. It has, therefore, been decided that the banks/ White Label ATM Operators (WLAOs) shall strengthen their systems/ mechanisms to monitor the availability of cash in ATMs and ensure timely replenishment to avoid cash-outs. Any non-compliance in this regard shall be viewed seriously and shall attract monetary penalty as stipulated in the “Scheme of Penalty for non-replenishment of ATMs” in the Annex. The Scheme shall be effective from October 01, 2021.
Chief General Manager-in-Charge
Encl: As above
Scheme of Penalty for non-replenishment of ATMs
Objective of the Scheme
The Scheme of Penalty for non-replenishment of ATMs has been formulated to ensure that sufficient cash is available to the public through ATMs.
The Scheme shall be effective from October 01, 2021. Therefore, banks/ WLAOs should put in place a robust system for monitoring the availability of cash in ATMs and ensure timely replenishment to avoid cash-outs.
Condition for counting instances of cash-outs in an ATM
When the customer is not able to withdraw cash due to the non-availability of cash in a particular ATM.
Banks shall submit system generated statement on the downtime of ATMs due to non- replenishment of cash to the Issue Department of RBI under whose jurisdiction these ATMs are located. In case of WLAOs, the banks which are meeting their cash requirement shall furnish a separate statement on behalf of WLAOs on cash-out of such ATMs due to non-replenishment of cash. Such statements shall be submitted for every month within five days of the following month i.e., first such statement for the month of October 2021 shall be submitted on or before November 05, 2021 to the Issue Department concerned.
Quantum of Penalty
Cash-out at any ATM of more than ten hours in a month will attract a flat penalty of ₹ 10,000/- per ATM. In case of White Label ATMs (WLAs), the penalty would be charged to the bank which is meeting the cash requirement of that particular WLA. The bank, may, at its discretion, recover the penalty from the WLA operator.
Administration of the Scheme
The Scheme of Penalty will be administered by Issue Departments of the Regional Offices of the Bank. The Competent Authority to impose penalty will be the Officer-in-Charge of the Issue Department of the Regional Office under whose jurisdiction the ATMs are located. Appeal against the decision of the Competent Authority, if required, may be made by the banks/ WLAOs to the Regional Director/Officer-in-Charge of the Regional Office concerned, within one month from the date of imposition of penalty. As the intention of the Scheme is to ensure replenishment of ATMs in time, appeals would be considered only in cases of genuine reasons beyond the control of bank/ WLAOs such as, imposition of lockdown by the State/ Administrative authorities, strike, etc.