RBI's new ATM rule
New ATM rule: The ‘Scheme of Penalty for Non-Replenishment of ATMs', which was recently announced, will take effect on October 1st.
Can't get money because the ATM is out of cash? This problem will be resolved soon. The Reserve Bank of India (RBI) recently announced that if ATMs fail to supply cash notes, banks may face penalties. The scheme's principal goal is to ensure that enough cash is available at ATMs for the general public.
While the RBI's on-the-ground execution is critical to efficient cash forecasting, Shruti Khandare, Chief Marketing Officer at MyFundBazaar, believes that the penalty method alone is unlikely to solve the issue of ATM cash accessibility.
"Despite the RBI proposal's well-intentioned goal, the penalty strategy alone is unlikely to solve the problem of ATM cash accessibility. While RBI's on-the-ground implementation is critical for efficient cash forecasting and prompt availability of currency to replenish ATMs in a timely manner, the fundamental cause of every ATM running dry - suboptimal cash forecasting and a delay in the availability of ATM-fit currency - must be addressed "Shruti Khandare expressed her opinion.
Banks and ATM managed service providers may suffer some teething problems at first, according to Sonali Kulkarni, Lead – Financial Services, Accenture in India, but this will assure appropriate cash availability to the public.
“While banks and ATM managed service providers may have some initial difficulties adapting to the new RBI rule on non-replenishment of ATMs, the policy will ensure that the public has access to appropriate cash."
She went on to say that banks will need to take a data-driven strategy and use machine-learning-powered predictive analytics to forecast cash management at ATMs and, as a result, better manage liquidity.
"During the pandemic, a large number of banks in India discovered the merits of data and AI-driven risk discovery and mitigation. Today, we see banks investing in advanced analytics that enables early warnings on market and credit risk. We see the same scenario being mirrored in ATM operations management. Banks will need to adopt a data-driven approach and leverage machine-learning powered predictive analytics to forecast cash management at ATMs and thereby, manage liquidity more effectively," she stated.
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