RBI Investigates ATM Cash Shortages After 12 Weeks of Complaints

Why in news

The RBI is investigating reports of ATM cash shortages in tier-II and smaller cities following complaints of unmet cash requirements.

Background

The Confederation of ATM Industry (CATMi) reported that ATM cash fulfillment levels were between 57% and 64% during April and May. The RBI has requested bank branch cash inventories to assess replenishment adequacy.

Facts for Prelims

• BodyRBI: The central bank of India responsible for monetary policy and banking regulation
• FactATM cash fulfillment levels were reported between 57% and 64% during April and May
• BodyCATMi: Confederation of ATM Industry, an industry body representing ATM operators

For Mains

Q. Discuss the challenges in maintaining seamless cash liquidity in tier-II and smaller cities and the role of the RBI in ensuring banking infrastructure stability.

Dimensions to cover in your answer

• Logistical bottleneck: Inefficient cash-in-transit (CIT) networks in rural and semi-urban geographies
• Liquidity management: Balancing bank branch cash reserves with ATM replenishment requirements
• Digital transition friction: Slow adoption of digital payments in smaller cities increasing reliance on physical cash

Keywords: Liquidity management · Banking infrastructure · Monetary stability · Tier-II cities · Cash-in-transit

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