Interoperable Card-Less Cash Withdrawal

Reserve Bank of India has directed banks and ATM operators to provide cardless cash withdrawal facilities at all ATMs.

Details –

In a circular, the RBI said, all banks, automated teller machine (ATM) networks, and White Label ATM Operators (WLAOs) may provide the option of ICCW at their ATMs.

Who will facilitate it?

• The National Payments Corporation of India (NPCI) has been advised to facilitate Unified Payments Interface (UPI) integration with all banks and ATM networks.
• The RBI said, while UPI would be used for customer authorisation in such transactions, settlement would be through the National Financial Switch (NFS) and ATM networks.

How will it function?

• The on-us and off-us ICCW transactions shall be processed without levy of any charges other than those prescribed under the circular on Interchange Fee and Customer Charges.
• In a bid to check fraud, RBI last month said, it has been decided to permit all banks to introduce card-less cash withdrawal through ATMs. According to the central bank, currently, cardless cash withdrawal through ATMs is offered by a few banks.
• A transaction carried out at an ATM of the card-issuing bank is called an On-Us transaction. A transaction carried out at any other ATM is called an Off-Us transaction.

What is UPI?

• Unified Payments Interface (UPI) is a system that powers multiple bank accounts into a single mobile application (of any participating bank), merging several banking features, seamless fund routing and merchant payments into one hood.
• It also caters to the “Peer to Peer” collect request which can be scheduled and paid as per requirement and convenience.
• Each Bank provides its own UPI App for mobile platforms.

About ‘National Payments Corporation of India’ –

• It is an umbrella organisation for operating retail payments and settlement systems in India.
• It is an initiative of Reserve Bank of India (RBI) and Indian Banks’ Association (IBA) under the provisions of the Payment and Settlement Systems Act, 2007.
• It has been incorporated as a “Not for Profit” Company under the provisions of Section 25 of Companies Act 1956 (now Section 8 of Companies Act 2013).
• The ten core promoter banks are State Bank of India, Punjab National Bank, Canara Bank, Bank of Baroda, Union Bank of India, Bank of India, ICICI Bank, HDFC Bank, Citibank and HSBC.
• In 2016 the shareholding was broad-based to 56 member banks to include more banks representing all sectors.