The small finance bank is now devising a strategy where it will give 5-7 free transactions every month to its customers, when they use it. ATM Network of other banks to withdraw cash.
“We realized that many customers were not using our ATMs, we could not make it a profit center, so we decided that we give free transactions to customers at other bank ATMs instead of continuing with these machines, R Bhaskar said Baboo, MD of Suryoday Small Finance Bank.
The bank is currently analyzing the ATM usage data in which it can offer 5-7 free transactions to use the other bank ATM Services.
Banks are gradually reducing the presence of ATMs as they incur overall cost of operation.
At the end of July, there were 213,000 ATMs in the country, a marginal increase of 1.5% from 209,000 in the same period last year. Micro-ATMs, on the other hand, have grown to 474,000 as against 305,000 in July last year, an increase of over 55%. Meanwhile, cash withdrawals stood at ₹ 2.5 lakh crore.
On Tuesday, Suryoday informed its customers about its decision to shut down ATMs.
“For operational reasons, Suryoday Bank ATMs will be closed from 1 October 2021. However, you may continue to use your Suryoday Bank ATM/Debit Card at any other bank’s ATM for your cash withdrawal requirements,” the message sent to the customers read.
The bank will focus on strengthening its door-to-door banking services, digital offerings and business linkage network. It currently has a network of over 5,000 business correspondents, which is expected to grow substantially. The bank also has more than 500 branches.
“While cash withdrawals have come down significantly, a large segment of our microfinance customers use micro-ATMs to withdraw cash, so we will strengthen that network,” Babu said. “We no longer need to build our own network, we can just collaborate and use services for a fee as financial systems become increasingly interoperable.”