The government is planning to introduce new automated teller machines (ATMs) that can dispense smaller notes, instead of mainly Rs 100 and Rs 500 notes. The main idea is to provide small notes i.e. Rs.10, Rs.20, Rs.50 to the public.
There are two options for this – install an ATM that provides smaller notes or install hybrid ATMs that allow people to exchange large notes for smaller ones.
This plan is already being tested through a pilot project in Mumbai. As per the report, these machines are being installed at places where cash usage is high, such as local markets, railway stations, bus depots, hospitals and government offices.
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The idea is to make small notes easily available in places where people often need quick change.
While digital payments are growing rapidly, cash continues to play a key role in daily life for many Indians.
Daily wage workers, street vendors, small shopkeepers and commuters often rely on cash for routine purchases and travel. For them, the shortage of Rs 10 or Rs 20 notes is more than a minor inconvenience. It can delay transactions, reduce sales or even affect daily earnings. Digital payments also require smartphones and stable internet connections, which are not always available, especially in semi-urban areas.
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For this purpose, the Reserve Bank of India may also be encouraged to print more small-denomination notes to support this effort.
But there’s a catch – Why is Government planning to provide smaller notes when UPI is widely accepted in India. Providing more cash might lead to less usage of UPI. Moreover, banks might incur more costs in installing and operating these ATMs.
This decision from the government is not new. There is a growing demand from small merchants and shopkeepers that they need smaller notes to operate their business daily. Moreover, the Rs.10 notes is not easily available in the market and banks. There were reports also that RBI is printing Rs.10 notes in less numbers whereas RBI has not confirmed this.
What you think of this – do let us know in the comment section below.
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