New Delhi: Indian cities are increasingly avoiding cash usage and choosing digital banking over the physical one. A major proof of this trend is the declining number of ATMs in the cities across the country. Between June and August this year, the total number of ATMs in the country decreased by 358, report by Times of India.
But it is a very significant change because ATMs increased at a compounded rate of 16.4 per cent over the past four years. Even though growth slowed to 3.6 per cent last year, this is the first time the number of ATMs has declined. Decreasing ATM use in cities after demonetization, and the increase in operational costs have forced banks to take a hard look at how they deploy ATMs.
SBI, which has the largest ATM network in the country, reduced its ATM count from 59,291 in June this year to 59,200 in August, Punjab National Bank from 10,502 to 10,083, and HDFC Bank from 12,230 to 12,225.
Electricity is a major expense as ATM kiosks have to be kept at 15-18 degrees centigrade through the day. An SBI official said the bank closed some of the ATMs after the merger with its associate banks.
“We had to decide whether the footfall at an ATM justified its running costs. Most of the ATMs we shut down were at places where another SBI parent or associate bank ATM was within a 500-metre radius. Our customers will not be greatly inconvenienced because of this. “Some other banks have not shut down any ATM but are going slow on expansion plans.