Half of the infrastructure may close down by March 2019.
Tighter compliance requirements aimed at enhancing the security standards of the ATM industry in India is set to weigh heavily on operators profits, prompting a industry body to raise concern that half of the existing ATMs in the country may close down by March 2019, reports The Japan Times.
The country may shutter half of roughly 2.38 million ATMs operating in the country amidst rising costs brought about by updated regulatory guidelines pushing for various hardware and software upgrades, V. Balasubramanian, director of the Confederation of ATM Industry (CATMi) said.
The central bank issued several regulatory orders including a new standard requiring ATM service providers and subcontractors to equip cash vans with tubeless tires. Banks are also required to install anti-skimming devices and whitelisting solutions across all ATM machines by 2019 in response to growing safety and security concerns brought about by surging card crimes.
The number of robbery, burglary and theft cases reported by banks during fiscal 2016 and 2017 stood at 922 and 1,012, respectively.
“It’s a major challenge for ATM service providers and other related parties to manage regulatory requirements and also maintain the level of controls up to the requirements of global standards within the changing landscape of technology in the industry,” audit and consultancy firm PwC India said in a report.
“The ideal road ahead to make the ATM management ecosystem sustainable is through a model of mutually agreeable costs while renegotiating the existing servicing contracts,” Rama Dorai, managing director for ATMs and allied services at FIS told TJT.
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