During lockdown, cash withdrawals from micro ATMs saw 3-time spike

Shalabh | TNN | Updated: May 1, 2020, 10:52 IST

NOIDA: When hotspots and clusters came into force a few days after the announcement of a nationwide lockdown, residents in Noida and Ghaziabad started queuing up to withdraw cash using a fingerprint scanner.
While the lockdown came into effect on March 24, ATM booths had started running out of cash by the first week of April itself.
During a review conducted to find out the reason behind the cash crunch, it was found that the number of withdrawals had spiked by a huge margin — two to three times — in both the districts.
With ATM booths drying up and locations getting sealed, banks had to scale up Aadhaar Enabled Payment System services with the support of retail agents (business correspondents). The officials who collected the data in Gautam Budh Nagar and Ghaziabad on behalf of Reserve Bank of India said that the amount of money that had been withdrawn during April was much higher than usual. Over Rs 41 crore had been withdrawn using the service in Ghaziabad, while in Noida people took out a total amount of Rs 26 crore.
Lead district managers of banks said the monthly average amount withdrawn through the agents used to be almost half of what had been withdrawn during April.
For comparison, the officer added, the average amount of money withdrawn in a month through the help of agents remained in the range of Rs 13 crore to Rs 14 crore and the money was primarily circulated in the rural areas.
“People withdrew so much money during the first two weeks that it led to a cash crunch across ATMs. The problem was worse in and around sealed locations since apprehensive residents took out an excessive amount of cash regardless of their needs and spending,” said Ved Ratna, lead manager of Gautam Budh Nagar district.
As much as Rs 4.32 crore was withdrawn in the sealed localities of Noida in April.
“The villagers also took out more than the usual,” added Ratna. A total of 232 agents (47 in sealed areas) were deployed during the month to cater to the population.
Lead manager of Ghaziabad, SP Yadav, said: “The amount has surpassed our expectations.” In Ghaziabad, about Rs 74 lakh has been circulated within sealed societies, he said, adding that 296 agents are active in Ghaziabad.
Earlier, the district administration and police blocked all entry and exit points within 1km from the hotspots and 5km from the clusters. The cash loaders deployed by banks found it difficult to access ATM booths in those areas. Following that, a number of complaints about out-of-cash ATMs poured in from Noida’s sectors 8, 22, 28.
Dharmendra Singh, a Sector 61 resident, said: “A lot of merchants are insisting on cash payments. They are saying that the mobile wallet service is charging some fees and are discouraging digital payment mode.”