What is White Label ATM and What are its Benefits?

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Those machines which are managed and operated by some non-banking organisation. As per the guidelines described by the Reserve Bank of India (RBI). Under this kind of business model, you can operate these Terminal for banking transactions irrespective of the bank account you have.

Under the Payment and Settlement Systems Act 2007, the Reserve Bank of India has approved the operation and expansion of  such terminals in the country. White label Terminal  are introduced primarily to expand the networks in rural and semi-urban areas.

White Label ATM Example

The following points are some examples of White Label ATM companies that operate such terminals in rural and semi-urban areas:

·         India 1 Payments (BTI Payments Private Limited)

·         Indicash. It is the largest player in the country that is responsible for uberisation of such terminals.

·         Tata Communication Payment Solutions Limited.

·         Hitachi Payment Services Private Limited.

·         Vakrangee Limited

First White Label ATM in India

The first White Label ATM in India is Indicash. It is not only the first established but the largest White Label Terminal  network in the country that is responsible for the uberisation of such terminals

Established by Tata Communication Payment Solutions Limited in Chandrapada, which is a small village located in the Thane district of Maharashtra on 27th June 2013.

Best White Label ATM Operators in India

According to the mandates as generated by the Reserve Bank of India, White Label ATMs have been set up. These machines accept debit cards and provide the first three to five services free, based on their location.

However, there are four major operators that are authorised by the RBI as of 2021. These include the following:

How to Apply for White Label ATM?

Only non-banking entities can apply for a White Label Terminal for a specific location. However, non-banking entities opting to apply for the same must have a total worth of 100 Crores to be eligible to get a licence.

Apart from this, their primary objective in applying for a White Label Terminal must be the development and enhancement of the rural and semi-urban areas by spreading terminals in their localities.

Nevertheless, to apply for a White Label Terminal, you must write an application letter to the NBFC or Non-Banking Financial Company informing you about the requirement. If your area meets the parameters, the application will proceed further.

The below points showcases the various benefits offer to its users:

·         Customers need not visit the bank branches on a regular basis since they can use the terminals for their banking engagements.

·          Terminals shall be available to the customers for 24 hours every day, including the holidays.

·         Terminals also help in lowering the operational costs of the bank branches since they would not have to face a huge crowd in the bank.

·         These terminals accelerate the financial inclusion of semi-urban, rural and low-income citizens of the country.

·         These Terminals accept all kinds of debit cards regardless of their issuing banks.

·         Customers can enjoy several services like energy bill payments, mobile recharging, and other related services.

Limitations of White Label ATM

Even though the White Label Terminal are beneficial for the citizens of India, there are a few limitations it, which include the following:

·         There remains a possibility of unsuccessful transactions like all terminals. In case any transaction disputes occur, there would be three entities required to resolve such issues which include the White Label operator, the customer’s bank and the White Label operator’s sponsor bank. Hence, the resolution process can be lengthy and time-consuming.

·         These terminals permit only a limited number of transactions for free. After this, customers need to pay a price to use the services provided by it. This might be discouraging for some individuals.

·         These terminals involve low interchange charges and high expenses of operating them. Hence its viability can come under unavoidable questions.

·         In case a terminals is present in the same area as a bank-managed terminal, it is quite common that the White Label would not be able to generate much profit.

Difference Between White Label ATM and Brown Label ATM

The following table showcases the difference between White Label ATMs and Brown Label ATMs: