Golden days of ATM over: 5 bank-run ATMs shut every day in India in last yr

ATM cash crunch: A man showing out of cash slips near SBI ATMs in Patna. Most of the ATMs have run out of cash in the city. PTI Photo
Banks across India have been on an Automated Teller Machine (ATM) shutting spree since the new year. Information from the Reserve Bank of India (RBI) shows that banks have shut down 5 ATMs on an average every day since March 2017. There are over 2,00,000 ATMs in India including onsite and offsite ones. (See Graphics at end)

Perhaps for the first time since the ATM boom in India in the 1990s, there has been a reduction in the number of bank-run ATMs in India (white label ATMs are not included in this analysis). Between March 2017 and February 2018, ATMs have declined by 1,695. This negative growth of ATMs in India seems to have been triggered by the Modi government’s decision to knock out 86 per cent of India’s currency out of circulation in November 2016.

According to RBI, banks were able to add only a fraction of the ATMs in 2016-17 than they had done in the past. During the first two years of the Modi government, more than 45,000 ATMs were added by public and private banks across India. However, in 2016-17, the year in which demonetisation was announced, banks added less than 3,000 ATMs. Till February this year, banks many of which are facing massive stress due to non-performing assets, celebrity customer frauds and allegations of impropriety of its top management, have actually reduced their ATM footprint across India.

States which are the hot spots of present cash crunch in India have also seen a reduction in ATMs over the last year. Six out the eight states that are facing severe cash crunch have seen a reduction in ATMs while the remaining have seen only a negligible increase in their numbers. Among the worst hit are Andhra Pradesh and Bihar where the number of ATMs has declined by 3 per cent between March to December 2017. This has meant that more people are now being forced to rely on fewer ATMs. In Bihar, there are only 80 ATMs for a million people. In Andhra Pradesh, the scenario is a bit better with 208 ATMs for every million people. In the other cash crunch hit state like Madhya Pradesh there are 137 ATMs for a million people. Across India there are 168 ATMs for every million of the population.


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