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ATMs in India being recalibrated to replace Rs 2,000 notes with Rs 500 notes

ATMs in India being recalibrated to replace Rs 2,000 notes with Rs 500 notes


Manglore Today News Network / News18

New Delhi, Feb 26, 2020:  The Rs 2,000 note might soon be pulled out of circulation in India even as it continues to remain a legal tender. According to a news report, the process to recalibrate nearly 240,000 ATMs in the country has started to replace Rs 2,000 notes with Rs 500 notes.

 

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A Business Standard report said that of the four cassettes within ATMs, those holding Rs 2,000 notes have already been replaced and may be removed altogether within a year. Three cassettes will now be filled with Rs 500 notes, and the fourth will either hold notes of Rs 100 or Rs 200 denominations, it added.

The report noted that it takes roughly 30 minutes to fix an ATM machine, but the overall pace of recalibration in the country will depend on the number of engineers deployed and how quickly they are moved.

Meanwhile, the existing Rs 2,000 notes with banks are going into their currency chests and will make their way back to the Reserve Bank of India’s (RBI’s) vaults, the report said.

According to the RBI data, the share of Rs 2,000 notes as a percentage of the total value of banknotes in circulation was at 50.2% in FY17, but that kind of major share has been now taken up by Rs 500 notes, at 51% in FY19.

Pulling out the higher-denomination Rs 2,000 notes from circulation would mean that cost of loading cash in ATMs would go up as cash vans will now have to make more trips to carry the same value of money, the report quoted a CEO of a managed services’ operator as saying. Also, ATM deployers and banks may earn more by way of inter-change fee as customers may have to punch in more transactions at ATM machines. Currently, inter-change charges stand at Rs 15 per swipe.


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