‘The new note size will require readjustment of ATM cash trays’
NEW DELHI: Cash crunch and its pain following the government’s demonetisation of Rs 500 and Rs 1,000 currency notes may last longer than feared, because nearly two lakh ATMs across India are to be configured to dispense the new Rs 500 and Rs 2,000 notes.
This was even acknowledged by Finance Minister Arun Jaitley on Saturday — three days after the move to curb black money — when he said it would take about two to three weeks for all the machines to be ready.
Banking and financial experts IANS spoke with were of the view that all ATMs in India needed to be calibrated afresh to disburse various currency from Rs 50 to the newly minted Rs 2,000 notes according to their weight, dimensions, design, and security features. And the new Rs 500 notes promised by the government have not even been issued.
The process, they say, will take over a month for the machines all over the country to start functioning.
ATMs and their cash trays so far were mainly made to dispense 100 and now-spiked 500 and 1,000 rupee notes.
The two high denomination notes were declared illegal by the government on November 8.
Experts said since the new Rs 500 and Rs 2,000 notes would be different in size and shape from the old Rs 500 and Rs 1,000 ones, engineers would have to readjust the cash trays, or cassettes, and the software running the machines.
Jaitley told the media on Saturday that “the finance ministry is constantly monitoring the cash replacement exercise,” referring to another time-consuming process of replacing invalidated currency notes with new bills in the teller machines.
Asked why the government had not recalibrated the machines in advance, Jaitley said it would have defeated the purpose “to maintain secrecy” of the surprise move.
Rajiv Kaul, CEO and Vice-Chairman at CMS, one of India’s largest cash management companies, told IANS on email that the immediate focus after the government’s decision was to flush out the spiked currency notes from the machines.
The second step would be to replenish the machines with new notes. Before that, they had to “ensure every ATM recognises the new notes and manages multiple replenishments including those of lower denominations,” Kaul said.
Anuj Chauhan, a banker in Delhi, said a technician has to physically visit an ATM for reconfiguration that would normally take about four hours for each machine.
That means the reconfiguration of all two lakh machines would take about 800,000 man hours.
If a technician completes two ATMs a day, companies managing the machines would all together need some 4,000 trained technicians to complete the process in 30 days.
If you build in natural delays and breakdowns into this calculation, it means the serpentine queues and chaos outside ATMs won’t go away anytime soon. (IANS)