Even as the Reserve Bank of India's June deadline to upgrade Automated Teller Machines (ATMs) in the country with higher security features draws near, around six out of ten ATMs still remain unchanged, reported The Print.
The central bank had flagged the vulnerability arising out of the ATMs operating on unsupported version of the operating system and mandated an upgradation of software and an overhaul of the cash-refilling system at ATMs, among other changes.
However, the confusion over the cost-sharing model between the banks and cash management companies has resulted in non-compliance, a senior official of a large private bank said, according to The Print.
The upgradation of all 2.2 lakh ATMs will require an additional spending of over Rs 3,500 crores for the banking industry, which are already cash-strapped due to mounting non-performing assets.
Responding to the directive, a banking analyst said, a well thought-out cost formula will aid faster action, according to The Print.
The RBI will extend the deadline for another six months or till the end of 2019-20 fiscal, government and banking sources said.
‘No Expansion of ATM Network in the Last 2 Years’
In November last year, the Confederation of ATM Industry (CATMi) had flagged that the upgradation could disrupt over 50 percent of ATM operations if the June deadline was to be followed, affecting both customers and banks.
A senior bank official said that they are hopeful the banking operations won’t be disrupted as the current RBI Governor Shaktikanta Das understands the issue, unlike former RBI Governor Urjit Patel.
In November, when the banks had approached Patel seeking an extension, the latter had remained firm in sticking to the deadline.
CATMi also pointed out that there has been no expansion of the ATM network in the country in the last couple of years.
However, the number of bank account-holders has risen significantly. With at least 25 percent of ATMs always out of service, things get even more difficult for the customers, a banker said, according to The Print.
(With inputs from The Print.)
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