Hitachi Payment Services, a leading operator of white-label ATMs, plans to nearly double its machine deployments by March to 5,000 units, having already installed new 1,340 machines by October this year
The Reserve Bank has in 2013 allowed any interested party to install white label ATMs under own brand names. Representational image
Hitachi Payment Services, a leading operator of white-label ATMs, plans to nearly double its machine deployments by March to 5,000 units, having already installed new 1,340 machines by October this year, a senior company official has said. Hitachi’s aggressive expansion is interesting as the white label ATM business has been in losses since the beginning primarily because of the lower inter-change charges which the banking industry and the regulator has not been able to revise to a profitable level for the operators, forcing many of them to withdraw from the business. It entered the white-label ATM (WLA) space way back in 2014.
The Reserve Bank has in 2013 allowed any interested party to install white label ATMs under own brand names. Accordingly, players like the Tatas offer it under Indicash, Hitachi calls its Money Spot among others. New additions will take the total WLA installations of the country’s fourth largest WLA operator to 5,000 by March as it plans to install 1,000 more machines between now and March, Rustom Irani, the managing director and chief executive of Hitachi Payment Services, told PTI on Monday.
During the lockdown months alone, it has installed 590 WLAs, taking its number now to 4,000 as of October, Irani said, adding that 750 were added between January and March. According to the latest RBI data, the largest WLA players are Tata Communications Payment Solutions (under Indicash label) which has been in operations since 2013, BTI Payments (under India1ATM and is a JV between ICICI Ventures and Banktech Group of Australia) and Vakrangee.
Other WLA operators are AGS Transact Technologies, RiddiSiddhi Bullions, and Srei Infrastructure Finance. Muthoot Finance has last year announced its exit from the segment due to mounting losses. Hitachi Payments, also the largest deployer of cash recycling machines in the country with over 19,000 machines in operations, is bullish about the WLA sector and expects the likely hike in interchange charges to help make the industry and them profitable.
Over 40 per cent of its WLAs are also cash recycling machines–which allow both cash deposit and withdrawals, therefore the name, he said. Irani’s optimism comes from their rural focus where costs are better manageable and he expects to turn cash positive if the interchange charges are hiked by at least Rs 3-4 per transaction from the present Rs 15. “At 19-20 per transaction, we can turn in profit,” he said.
Irani said their growth has been faster since 2017 on the back of the note-ban and since 2018 it has been installing at least 1,000 new machines annually.
The Hitachi group is a pioneer in the domestic payments space having managing over 55,000 of the 2.59 lakh ATMs (including 19,000 cash recycling machines), 4,000 WLAs and 1.42 million points of sale devices, including mobile PoS and QR code machines.
Its also has a manufacturing facility in Bengaluru that can roll out 1,500 cash-recycling machines a month.