100 per cent FDI in White Labelled ATM operations

  • Government has allowed Foreign Investment upto 100% in White Label ATM (WLA) operations, subject to the following conditions :-

    (i) Any non-bank entity intending to set up WLA should have minimum net worth of Rs. 100 crore as per latest financial year’s audited balance sheet, which is to be maintained at all times.

    (ii) (ii) In case the entity is also engaged in any other 18 Non-Banking Finance Company (NBFC) activities, then the foreign investment in the company setting up WLA, shall also comply with the minimum capitalization norms for foreign investment in NBFC activities.

About WLA:

White Label ATM or White Label Automated Teller Machines or WLAs inIndia will be owned and operated by Non Bank entities.  From such White Label ATM customer from any bank will be able to withdraw money, but will need to pay a fee for the services. These white label automated teller machines (ATMs) will not display logo of any particular bank and are likely to be located in non traditional places.

The RBI has permitted non banking entities to set up or start ATMs. These types of ATMs are called as White Label ATMs (WLAs). The important guidelines issued by the RBI which are useful for our visitors who are preparing for bank exams, are as under:

  • Non-bank entities should have a minimum net worth of Rs 100 crore as per the latest financial years audited balance sheet, which is to be maintained at all times.
  • Non-bank entities that intend setting up, owning and operating ‘White Label ATMs’ (WLAs) would service customers of banks in India, based on the cards (debit/ credit/prepaid) issued by banks, the RBI said.
  • Non-bank entities will have to obtain authorization from the RBI under the Payment and Settlement Systems Act 2007 within four months from the date of issuance of these guidelines.
  • Tata Communications Payment Solutions Ltd. (TCPSL), a subsidiary of Tata Communications, rolled out the first-ever white label Automated Teller Machines (ATMs) network under the brand Indicash.
  • Like most other bank ATMs, Indicash offers a host of cash and non-cash services such as cash withdrawals, balance enquiries, mini-statements and PIN change.
  • It will accept all domestic debit cards with the first five transactions a month being free, in line with RBI regulations for use of ‘Other Bank ATMs’.
  • The Indicash ATMs have been designed to eliminate several concerns of cardholders. The Indicash machines are Dip machines, which cannot swallow cards.

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