RBI/2014-15/114
UBD.CO.LS (PCB) Cir.No.1/07.01.000/2014-15

July 2, 2014

Chief Executive Officers of all
Primary (Urban) Co-operative Banks

Dear Sir/Madam

Review of norms for opening of onsite/off-site ATMs by Urban Co-operative Banks

Please refer to our circular ref: UBD (PCB) BPD Cir No.50/09.69.000/2005-06 dated April 28, 2006 in terms of which UCBs satisfying the criteria of Financially Sound and Well Managed (FSWM) banks were permitted to set up on-site ATMs without prior approval of RBI. In terms of our circular ref: UBD.CO.LS.(PCB). Cir. No.30/07.01.000/2013-14 dated October 15, 2013, prior approval of RBI under Section 23 of the B. R. Act, 1949 (AACS) is necessary for opening full-fledged branches, specialized branches (CPCs, RAPCs), satellite / mobile offices, controlling offices, extension counters and off-site ATMs.

2. It has now been decided that CBS-enabled UCBs which satisfy the FSWM criteria as mentioned at para 2 (a) to (e) of our circular UBD.CO.LS (PCB) No. 24/07.01.000/2013-14 dated October 1, 2013 may install onsite / off-site / mobile ATMs as per their need and potential in their area of operation without prior approval of RBI, subject to the conditions given below.

1. The bank shall have an assessed networth of ` 50 crore and conform to the FSWM criteria based on the Reserve’s Bank inspection Report relating to the financial year immediately preceding the financial year in which the ATM (s) is / are proposed to be installed and in the absence thereto, to the financial year just before the immediate preceding year.

2. The bank should have an impeccable record of regulatory compliance and no warning letter / cautionary advice should have been issued to or monetary penalty imposed on the bank on account of violations of RBI directives / guidelines during the financial year in which the ATM(s) is/are proposed to be installed and during the two immediately preceding financial years.

3. Mobile ATMs shall be operated strictly within the bank’s approved area of operation and any violation thereof may lead to ban on further branch expansion and / or grant of other regulatory approvals apart from action under section 47 A of the B. R. Act, 1949 (AACS). Mobile ATMs will have to be linked to a branch as per extant instructions.

3. The conditions subject to which off-site / mobile ATMs can be operationalised by UCBs are given in Annex II. There is no change in facilities which can be provided through ATMs.

4. UCBs shall report to the concerned Regional Office of Reserve Bank under whose jurisdiction the Head Office of the bank is functioning immediately after operationalisation of offsite / mobile ATMs and in any case not later than 15 days, as per the format enclosed (Annex I) and obtain authorization under section 23 of the B. R. Act, 1949 (AACS).

Yours faithfully,

(A. K. Bera)
Principal Chief General Manager

Annex I

Annex II

Conditions subject to which off-site ATMs can be operationalised by banks

(i) The business transacted at the Off-site ATM shall be recorded in the books of the respective branch/ base branch / Centralised Data Centre.

(ii) No person other than the security guard should be posted at such Off Site ATM centre.

(iii) Bank should make adequate stand-by arrangements for meeting the cash requirements of the ATM.

(iv) The bank should ensure that only properly sorted and examined notes are put into circulation through the ATM.

(v) Third party advertisement on the ATM screens / Network, such as display of products of other manufacturers /dealers /vendors is not permitted. However, there is no objection to banks utilizing the ATM screens for displaying their own products