The rise of micro- ATMs

              The micro ATMs use have risen to 15.59 million in February this year, up by 83.19 percent from a year ago, which signifies that cash is still a much preferred medium of exchange. Micro ATMs are machines that are modified point of sales terminals  where we can swipe the card and is a mini version of an ATM. These machines connect to their core banking system via GPRS to perform banking transactions. It is used to disburse cash in remote locations where bank branches cannot reach. The platform will enable a million businessmen to conduct instant transactions. The basic transaction types are deposits, withdrawals, fund transfers, balance enquiries and mini statements. If we need cash, we can go to a nearby merchant and swipe our debit card and the amount is handed over to us from the store. At the same time if the cash is with us , an equal amount can be credited to the store's bank account and if it's a savings account we can earn interest from it. They are easy to deploy and cost effective devices and are now being more prevalent in India's semi-urban and rural areas. This is mainly because rural India has fewer bank branches , making it difficult for residents to access ATM  services that are primarily available at faraway bank branches. It is quick and is an easy digital payment system and allows bank account holders to make transactions using their Aadhaar number and biometric authentication without physically visiting a bank branch for ATM services and thus is backed by the Aadhar Enabled Payment System( AePS) which will serve as the ID proof required to withdraw money.

                  All transactions like cash withdrawal, balance check, mini statement can be done through micro ATMs. It helps people of the rural area in financial inclusion. Also now a shop can be converted to an ATM, it a low cost option , is a portable device and easy to set up anywhere in remote areas and is an interoperable equipment that can work for any bank. It plays a major role in digitisation. Also banks can deploy micro ATMs at different places within a shorter radius of distance as it is cost effective too. It bridges the gap between the need and availability of cash requirement in the eco- system. It works as a Bank-in -a-box, allowing customers to withdraw cash and know their balance. This machine comes with a fingerprint scanner attached to it. These are similar to point of sale( PoS ) terminals and are a doorstep mobile banking arrangement. It has connectivity through GSM and hence can travel from village to village. Even though cash payments due to UPI are more prevalent now, India is still cash driven as cash in circulation in FY23 was Rs 33.5 trillion and in FY24, this is projected to be Rs 35.5 trillion.  Thus these micro ATMs act as an important lifeline for the unbanked and underbanked population ,to access the cash. Another main reason for the acceptance of micro ATMs is that the distribution of traditional ATMs within India is unbalanced and India is among the countries to have the lowest ATM penetration in the world. Around 65% of Indian Population lies in rural India and they have only 20% of all ATMs in the country.

                  Unlike the other ATM machines, micro ATMs offer more personalised service, as there are agents available to assist with transactions. This is beneficial to customers who prefer face to face interactions and for those who struggle with digital technology. Also with the surge in AePS transactions in recent years, along with the pandemic, micro ATMs have been gaining more popularity. Many Fin Techs are working on micro ATMs and expanding the market by offering financial services to the unserved and underserved population  and making banking services easily accessible in remote areas. Also people need not travel long distance to access the nearest ATM or a bank. It ensures a continuous flow of cash to keep rural economy operational and bridge gap between customers and their financial needs. Thus the micro ATMs will play an important role in accelerating the reach of basic banking operations by connecting the vulnerable sections of our society.