In recent times, there has been a noticeable shift in the distribution of ATMs across the country. Public sector banks (PSBs) have been consolidating their networks and focusing on digital services, causing their share in deployed ATMs to shrink. On the other hand, private lenders have been aggressively expanding their ATM presence in a fierce competition for deposits.
Over the course of 12 months leading up to January 2024, PSBs reduced their ATM network by 1,343 machines, bringing their total count to 1,36,173. In contrast, private banks added a significant number of ATMs, increasing their network to 79,225 with the addition of 3,502 machines. This expansion trend is not limited to ATMs alone, as HDFC Bank has revealed plans to add 1,500 branches during FY25. Other private banks have also announced their intentions to expand their branch networks.
The reduction in PSBs’ ATM count has primarily occurred in offsite ATMs, which have decreased from 96,243 a year ago to 93,381 currently. Two years ago, the count stood at 87,160. Bankers have indicated that they are being cautious in deploying offsite ATMs due to the unprofitable nature of acquiring customers from other banks, given the existing cap on charges. Additionally, there is uncertainty surrounding new regulations that could potentially increase operational costs.
On average, each ATM sees approximately 2,400 transactions, with an average withdrawal amount of Rs 4,918 per transaction. These figures shed light on the significant usage and reliance on ATMs in the country’s banking landscape. As private banks continue their expansion efforts and PSBs focus on digital services, it remains to be seen how the ATM landscape will evolve in the coming months and years.
