- India's currency in circulation hit a record Rs 42.54 lakh crore as of May 22, RBI data shows
- ATM operators received only 64% of cash needed in March and 57% in April for replenishment
- ATM costs have risen due to higher fuel prices, security, maintenance, and wage expenses
India's currency in circulation has climbed to a record Rs 42.54 lakh crore as of May 22, according to Reserve Bank of India (RBI) data. Yet, ATM operators are warning that some machines could run low on cash, raising concerns about access to physical currency.
The Confederation of ATM Industry (CATMi), which represents ATM operators, cash logistics firms and service providers, has reportedly flagged a significant gap between cash required for ATM replenishment and the amount available. According to a report submitted by CATMi to the Indian Banks' Association (IBA), operators received only 64% of their cash requirement in March and 57% in April.
ATM operators required around Rs 94,000 crore for replenishment in both months. However, only about Rs 61,000 crore was available in March and Rs 54,000 crore in April, according to CATMi.
The challenge comes as operating an ATM network becomes increasingly expensive. Costs linked to cash transportation, security, maintenance and monitoring have risen sharply in recent years, driven by higher fuel prices and wage costs.
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At the same time, ATM usage continues to decline. RBI data showed ATM transactions fell to 446.5 million in May from 498.4 million a year earlier, while the value of withdrawals declined to about Rs 2.5 trillion from Rs 2.64 trillion. As digital payments gain ground, operators are processing fewer transactions even as they maintain the same infrastructure.
The growing popularity of UPI has accelerated the shift away from cash transactions. However, ATM networks remain critical for customers who continue to rely on physical currency.
The impact of any cash shortages is likely to be felt most acutely in rural and semi-urban areas. Senior citizens, pensioners, welfare beneficiaries, farmers and small traders often depend on ATMs to access pensions, government transfers and other cash-based transactions. In many locations, the nearest alternative ATM may be several kilometres away.
While digital payments have become more widespread, internet connectivity issues and limited merchant acceptance can still restrict their use in some regions.
The RBI can impose penalties on banks if ATMs remain out of cash for prolonged periods. While isolated instances are unlikely to attract regulatory action, repeated or widespread shortages could invite scrutiny.
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For consumers, the warning does not indicate any risk to bank deposits or a broader shortage of currency. Cash in circulation remains at a record level. However, customers may encounter occasional difficulties withdrawing cash from some ATMs, particularly in smaller towns and rural areas.
Maintaining access to multiple payment options, including UPI and a modest cash buffer for emergencies, could help consumers avoid disruption if nearby ATMs temporarily run out of cash.
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