India to receive cardless cash withdrawals at banks and ATMs using UPI

By Puja Sharma

As per the announcement by the RBI Monetary Policy Committee, RBI Governor Shaktikanta Das has mentioned that the system of cardless cash withdrawal will be made available across all banks and ATM networks using UPI in India.

To increase customer convenience and plug fraud incidents, the Reserve Bank of India mandated interoperable cardless withdrawal using the UPI platform across its ATM network this week. The regulator is expected to soon issue detailed guidelines to NPCI, ATM networks, and banks, to operationalise the service.

Several banks in the country allow cardless cash withdrawals at ATMs on an on-us basis, meaning that they are only available to their customers at their ATMs. By operationalizing a service like this, frauds like skimming, card cloning, and device tampering would be contained.

Shaktikanta Das, Governor of the Reserve Bank of India, on April 8 announced cardless cash withdrawal using a unified payment interface (UPI) at all banks and ATMs as a way to prevent fraudulent transactions during the first Monetary Policy Committee (MPC) statement for the financial year 2022-2023. Bharat Bill Payments System Operating Units have been lowered to 25 crores from 100 crores, said Das.

What is a cardless cash withdrawal?

A cardless cash withdrawal facility allows individuals to withdraw cash without using any debit cards at Automated teller machines (ATMs). An individual beneficiary can initiate an electronic withdrawal request for a minimum of Rs100 per transaction and a maximum of Rs10,000 per day or 25,000 per month (the limits may change based on regulatory guidelines).

Several banks in the country permit cardless cash withdrawal through ATMs (at their ATMs) for their customers on an on-us basis.

The availability of card-less withdrawals via ATMs is currently limited to a few banks. According to Das in his MPC statement, UPI-based card-less cash withdrawals will soon be available across all banks and ATM networks.

The apex bank of India has announced that cardless ATM withdrawals will be made available across all bank ATMs. Although some banks have ATMs that allow these transactions, RBI governor Mr. Shaktikanta Das has announced this facility will now be available across all bank ATMs and will be using the Unified Payments Interface (UPI) platform for the disbursal of cash.

Founder of Spice Money, Dilip Modi, said: “While the pandemic did act as a catalyst, digital transactions in our country have risen exponentially over the last few years because of increasing internet and smartphone penetration as well.”

“We consider ourselves to be fortunate to have been at the forefront of this change, and we understand that with this initiative, soon all users will have greater freedom to withdraw money at their convenience, without being restricted by a physical ATM card. We welcome this announcement of making cardless withdrawals available across all ATMs and believe that it will help us take another significant step towards creating a truly digital economy,” Modi added.

Key takeaways

• UPI will soon allow bank customers in India to withdraw cash from ATMs and banks without using a card.
• RBI says this should help reduce frauds such as card cloning, card skimming, etc.
• An individual can initiate an e-withdrawal request for a minimum of Rs100 per transaction and a maximum of 25,000 per month.
• At present, the cardless cash withdrawal facility is different at each bank and requires you to use the respective bank’s mobile app.