During the first week of the salaries, people are keenly looking at the ATMs. Standing in the queues and withdrawing multiple currency notes. After the demonetisation, the demand for ATMs increased twice than before. The banking system in India has reached vast numbers of villages. People have adopted and opened bank accounts, including government-backed Jan Dhan bank accounts, which are opened to help rural people adapt to modern systems of finance. Coming to the ATMs have you ever thought who maintains those machines ?
* How does the cash flow reach citizens ?
* How do the banks transfer money ?
* What is the profit of running such small ATMs ?
* Who runs it ?
* Who owns it ?
Let's understand the phenomena of ATMs. The ATMs work in different models; one is a franchise model and another one is a collaboration of both banks operated and owned by private. The ATM business is charged based on interchange of transaction in which, for every other transaction, a particular amount is deducted. Almost 19 rupees are charged for transaction like transaction, mini statement, monthly maintenance and decline of transactions. These commissions are taken by the ATM owner.
The ATM is operated in the franchise model then it is the total responsibility of the person who owns it, including the money he invests. The money which is being taken as commission would be his full wealth. When it comes to bank operated, the commissions are less but the person who owns the rental space has no burden. Banks directly send money in cash vans along with gunmen holding security cover.
To start an ATM business, one has to have a good rental space in the prime location, which can yield a good amount of footfall. This business is also based on volume, making work only in prime locations. Most of the expenditures come from electricity bills for air-conditioned ATM rooms, basic billing receipt paper and overall maintenance, along with one security guard.
India's demographics are so complex that some people use tap to pay especially in urban sectors. whereas on the other hand, 6 lakh villages where people still depend on cash wealth only. Nowadays, many ATMs are adapting to new trends, making them into mini bank centers. Citizens do not need to visit regular banks frequently, you can check, deposit, or new government policy benefits can be directly taken from ATMs and receive cash benefits. Overall, it is changing and adapting new methods for people and ATM machine business works only based on footfall.
