Number of ATMs to double; will also accept deposits

Number of ATMs to double; will also accept deposits

The government today said banks have been asked to upgrade their ATMs to double-up as cash collecting machines as well to mobilise Rs 11 lakh crore lying as cash with people.

Also, the public sector banks have been asked to double the number of ATMs from about 63,000 in the next two years, Finance Minister P Chidambaram told reporters after reviewing working of state-owned banks and financial institutions.

"People must take to banking ... Something like Rs 11 lakh crore lies as cash in hands of people. That Rs 11 lakh crore money should not lie in hands of people, it should lie in banks," he said.

He said more people will take to banking if there are more branches and facility to draw money whenever needed and put it back into banks when they do not require it.

"Now banks have been advised to quickly upgrade their ATMs to not only cash disbursing machines, but also cash accepting machines.

"Banks should also intensify door-step banking, in bazaars, markets to collect the daily collection of shops in order to mobilise the savings of the people," the minister added.

He further said that public sector banks have about 63,000 ATMs in different parts of the country.

"The goal is to double it in two years. I am confident they will achieve it," he added.

He said upgrading ATMs to cash collecting machines will help in channelising a large part of cash lying with public in the banking system.

"Ideal banking is that money should remain in bank and I can withdraw it when I want...So the ideal is (that) all money should be in the bank," he said when asked what part of Rs 11 lakh crore should be in banks and with public. 

Chidambaram further said that reviving investment is the way out of the economic challenges. "In fact, most of our problems will be addressed if we revive investment...across the board, small, medium and large industries," he said.

On minority sector lending, he said as many as 1,098 new bank branches have been opened in 121 minority concentrated districts in the country in 2011-12 and another over 1,000 branches would be opened in this fiscal.

Lending to the individuals belonging to the minority sections of the society increased to about Rs 1.65 lakh crore in 2011-12 from Rs 1.43 lakh crore in the previous year.

Chidambaram said minority sector lending was 14.5 per cent of total bank disbursals and objective is to increase it to at least 15 per cent.

The Finance Minister also said that an educational campaign to encourage electronic transactions would be launched in a month's time. Currently e-transactions constitute about 25 per cent of the total transactions.

Indian Banks' Association (IBA) has been asked to design the campaign. Meanwhile, RBI Deputy Governor K C Chakrabarty, who was also there in the review meeting, said that interest rates on bulk deposits should come down which will give space to banks to bring down the cost of lending.

"We are saying you must not give that much high interest rate on bulk deposits," he said, adding that the message was reiterated in the meeting by the RBI and the finance ministry.

Bulk deposits constitute about 60 per cent of the total deposits. SBI Chairman Pratip Chaudhuri said the bank would look into the advise given by the Finance Minister to reduce interest rate for consumer durables. 

DH Newsletter Privacy Policy Get top news in your inbox daily
Comments (+)