Last month, India¡¯s first UPI ATM was launched. Hitachi Payment Services, a subsidiary of Japan-based Hitachi Ltd, announced the launch of India's first-ever UPI-ATM as a White Label ATM (WLA) named Hitachi Money Spot UPI ATM, with the National Payments Corporation of India (NPCI).
But what exactly are White Label ATMs (WLAs)? How are they different from regular ATMs??
ATMs set up, owned and operated by non-banks are called WLAs. Non-bank ATM operators are authorised under the Payment & Settlement Systems Act, 2007 by the Reserve Bank of India (RBI).
As mentioned in its definition itself, WLAs are set up, owned and operated by non-banks, whereas regular ATMs are set up, owned and operated by banks. But for a customer, as per RBI, using a WLA is just like using an ATM of any bank.
WLAs were introduced in the country in 2013-14 to promote financial inclusion. The rationale for allowing non-bank entities to set up WLAs has been to increase the geographical spread of ATMs for increased/enhanced customer service, especially in semi-urban/rural areas.
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In June 2013, Tata Communications Payment Solutions (TCPS), a wholly owned subsidiary of Tata Communications, launched India¡¯s first WLA at Chandrapada, a tier-V town near Mumbai.?It was branded 'Indicash' by the company, as per Business Standard. TCPS got the license from RBI to launch white-label ATM operations in May 2013.
TCPSL had engaged with national and regional banks to support its rollout plans. On this front, the company had tied up with Federal Bank, which had been designated as a sponsor bank to take care of cash operations, dispute resolutions and regulatory reporting. The Indicash ATMs were owned, operated and guarded by TCPSL.
Like most other bank ATMs, Indicash offered a host of cash and non-cash services such as cash withdrawals, balance enquiries, mini-statements and PIN changes.?It accepted all domestic debit cards with the first five transactions a month being free, in line with RBI regulations for use of ¡®Other Bank ATMs¡¯.
The Indicash ATMs were designed to eliminate several concerns of cardholders, including the fact that they were dip machines, which could not swallow cards.
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