Mumbai resident Aesha has been on the hunt for cash since early Friday morning but is still unsure if she will get her hands on any banknotes. She has been to three ATMs but found only one functional – with scores of people already queued up.
“With this mad rush and 50 people ahead of me, I doubt I will be able to withdraw any cash,” she told HT.
But Aesha – and millions of customers like her across India – are unlikely to get any relief soon as ATM manufacturers and cash-management companies struggle to manage the surging demand and a crunch in supply of Rs 100 notes.
Many ATMs in big cities continue to be out of service as agencies say they are racing against time to keep filling up 220,000 ATMs with just 8,800 currency vans and a manpower of 35,000 people.
“Usually, an ATM can store about 15-20 lakh worth cash but given the limitation of 100 rupee notes, it will be at most about Rs 2 lakh,” said cash management firm Securitrans India’s business chief Anush Raghavan.
“So, ATMs will be running at just about 10% capacity.”
The queues and panic is the result of a surprise government move on Tuesday of pulling Rs 500 and Rs 1000 notes out of circulation in a bid to drain illegal cash from the economy. Since then, people have rushed to banks and ATMs but delays, long queues and unexpected formalities have dogged the exchange of old currency.
The government has said ATMs will dispense up to Rs 2000 per day per card. The limit will be increased to Rs. 4000 from next Saturday.
Cash-management agencies have to evacuate, count and safely send cash to the banks and refill the ATMs. Moreover, given the rush, they say their work has increased threefold.
“Our 3-fold plan is to pull out existing 500 and 1000 notes, refill 100 rupee notes from the banks, configure ATMs to limit the withdrawals at Rs 2,000. Typically, there are 15 visits in a month for each ATM and now it will be daily 2-3 times or maybe more,” Raghavan said.
Rajiv Kaul, chief of CMS Info Systems that handles about 4,500 cash vans said their focus was on “evacuation and replenishment” of ATMs.
“We not only need to replenish the machines with new notes but also ensure every ATM recognizes the new notes and manages multiple replenishments due to lower denominations. We are also planning for perceived uncertainties in the consumers’ mind that is likely to result in greater number of withdrawals.”
AGS Transact Technologies, another ATM manufacturer and technology provider, said it has 1150 van fleet capacity and has been evacuating old notes since Wednesday midnight. A senior official said, “We cannot even employ more people as these are trained staff and need trusted people. Our existing staff has been working from 5 am till late evening.”
Dipak Gupta, Joint Managing Director with Kotak Bank said, “We foresee some worry further due to the supply problem of 100 rupee notes at ATMs. In the north, there is still sufficient supply but in pockets of south and west there is some shortage.”