Types ATMs in India
| Bank owned | Brown label | White label |
| Set up and owned by the bank itself. Bank is responsible for their overall operation and maintenance. Banks are given responsibility of Cash Management, Network Connectivity, Security etc. | Work on cost-sharing between Bank and non-Bank service providerThe Bank needs to take care of cash management and network connectivity while a service provider (Non-Banking Entity) provides for the ATM machine. | ATMs set up and managed by non-Banking entity.The entire gamut of operations including ATM hardware, Cash Management, Network Connectivity, Security etc. is looked after by the non-banking entity. |
Interchange fee
- “Interchange Fee” is the charge that Bank “A” pays to another bank ‘B” when the customer of Bank “A” uses the ATM/PoS Machine of the Bank “B”. This charge is recovered by the Bank “A” from the customers if the number of transactions exceed five free transactions. The White label ATMs (WLAs) operators have been demanding an increase in the Interchange fee to compensate their higher operating costs.
- Customer charges: Customers are eligible for five free transactions every month from their own bank ATMs. They are also eligible for free transactions from other bank ATMs i.e., three transactions in metro centres and five transactions in non-metro centres. Beyond the free transactions, the customer would be required to pay Rs 20 per transaction.
RBI's announcement
- Increase in Interchange fee from Rs 15 to Rs 17 for financial transactions and from Rs 5 to Rs 6 for non-financial transactions (which includes balance inquiry, mini statement, PIN change, etc.)
- To compensate the banks for the higher interchange fee and given the general escalation in costs, they are allowed to increase the customer charges to Rs 21 per transaction. This increase shall be effective from January 1, 2022.