Low ATM penetration plagues India

Rural areas remain under served.

Rural areas accounted for only 10% of the total number of ATMs deployed in India during fiscal year 2013. Banking industry sources said this was due to challenges such as the high cost of setting up bank branches and low transaction.

They noted, however, that an expansion of multi-vendor ATMs and solar powered ATMs in semi-urban and rural areas will lead to further development of ATM industry in the country.

According to the research report, India ATM Industry Outlook to 2018-Increasing Penetration of White Label ATMs to Intensify Growth, there is a rising trend of outsourced ATMs in India. It said banks are gradually expected to reduce their ATM operations and are anticipated to emphasize on their core business.

Analysts said the ATM industry in India is projected to grow at a CAGR of 19.1% over the period FY’2014-FY’2018. The expansion of multivendor ATM’s, an increase in the number of solar-powered ATMs, especially in semi-urban and rural areas, and the emerging trend of White-label ATM’s will aid the future growth of the industry.