Non-bank entities that are keen to be a White Label ATM (WLA) operator may need to open three ATMs in rural and semi-urban areas to open one in a metropolitan city, said a senior banker who was part of the deliberations team formed by the Reserve Bank of India. In February, the central bank came out with guidelines on such ATMs where it said non-bank entities can set up, own and operate ATMs to accelerate their growth and penetration in the country.
The central bank also mandated these WLA operator to have a minimum net worth of Rs. 100 crore at the time of making the application and on a continuing basis after issue of the requisite authorisation, which may be relaxed in the follow-up guidelines expected from the central bank.
The banker said that it would be left to the WLA operator and the sponsor bank to work out a revenue sharing model. However, the central bank in its draft guidelines stated that the WLA operator shall not be permitted to charge any fee from the customers for the use of the ATM resources.
The guidelines said that the WLA operator should not charge any fee other than the Interchange fee applicable when a customer uses third party bank’s card to withdraw from that ATM. Currently, withdrawal from third party ATMs costs the bank Rs 18 for cash queries and Rs 8 for non-cash per customer.
WLA Operator shall declare one `sponsor bank’, who will serve as the settlement bank for the settlement of all the service transactions at the WLAs. However, the banker said that instead of one sponsor bank per operator, the central bank was suggested locality-specific settlement bank in the lines of the lead-banks.
Cash related disputes faced by customers would be dealt by the sponsor bank and the guidelines in this regard was expected soon, said the banker.