RBI Introduces Scheme of Penalty For Non-Replenishment of ATMs: Details Inside

To minimise cash run-outs, banks and White Label ATM Operators (WLAOs) are now required to improve their systems and procedures for maintaining cash flow in ATMs and ensuring prompt refill. Any non-compliance in this respect will be taken seriously and will result in a monetary penalty as specified under "Scheme of Penalty for ATM Non-Replenishment." The Scheme will go into effect on October 1, 2021. The Scheme of Penalty for non-replenishment of ATMs is designed to guarantee that the public has access to adequate cash via ATMs. The Scheme will go into effect on October 1, 2021 and to avert cash-outs, banks/WLAOs must have a comprehensive mechanism for tracking the availability of cash in ATMs and ensuring timely refilling. According to a circular issued by the Reserve Bank of India (RBI) dated August 10, 2021 here are the details of the Scheme of Penalty for ATM Non-Replenishment that you need to know.

• Condition for counting instances of cash-outs in an ATM: When the customer is not able to withdraw cash due to non-availability of cash in a particular ATM, RBI said.
• Procedure: Banks shall submit system generated statement on downtime of ATMs due to non- replenishment of cash to the Issue Department of RBI under whose jurisdiction these ATMs are located. In case of WLAOs, the banks which are meeting their cash requirement shall furnish a separate statement on behalf of WLAOs on cash-out of such ATMs due to non-replenishment of cash. Such statements shall be submitted for every month within five days of the following month i.e., first such statement for the month of October 2021 shall be submitted on or before November 05, 2021 to the Issue Department concerned, RBI has stated in the circular.
• Quantum of Penalty: Cash-out at any ATM of more than ten hours in a month will attract a flat penalty of Rs 10,000/- per ATM. In case of White Label ATMs (WLAs), the penalty would be charged to the bank which is meeting the cash requirement of that particular WLA. The bank may, at its discretion, recover the penalty from the WLA operator, RBI has claimed in the circular.
• Administration of the Scheme: The Scheme of Penalty will be administered by Issue Departments of the Regional Offices of the Bank. The Competent Authority to impose penalty will be the Officer-in-Charge of the Issue Department of the Regional Office under whose jurisdiction the ATMs are located. Appeal against the decision of the Competent Authority, if required, may be made by the banks/ WLAOs to the Regional Director/Officer-in-Charge of the Regional Office concerned, within one month from the date of imposition of penalty. As the intention of the Scheme is to ensure replenishment of ATMs in time, appeals would be considered only in cases of genuine reasons beyond the control of bank/ WLAOs such as imposition of lockdown by the State/ Administrative authorities, strike, etc, according to RBI.