The Reserve Bank of India (RBI) has proposed to make cardless cash withdrawals available at all ATMs through the Unified Payment Interface (UPI) in its first bi-monthly Monetary Leverage Review. RBI Governor has said that withdrawals from ATMs without cards can be done easily and frauds like card skimming and cloning can be avoided.
Cardless cash withdrawal means
What is cardless cash withdrawal: Customer can withdraw cash from ATM without using his / her debit or credit card. Currently only a few banks offer cardless cash withdrawal services. Some banks, such as State Bank of India (SBI), HDFC Bank, ICICI Bank, and Punjab National Bank (PNB), offer a small amount of card-free cash withdrawals through OTP. However, RBI expects all banks to provide these services at their ATMs through UPI.
How to do cardless cash withdrawal and How does it work?
Experts say there is a possibility of offering cash withdrawal services from ATMs through UPI in two ways.
Cardless cash withdrawal at ATM Option - 1:
If the customer provides the required details at the ATM terminal, the ATM will provide the QR code. The customer has to scan the QR code through the UPI app on their phone and approve the request. You can then withdraw cash from the ATM.
Cardless cash withdrawal at ATM Option - 2:
Another method is for customers to enter their UPI ID and withdraw at touchscreen ATMs. After entering the UPI ID at the ATM, the request is received through the UPI app on the customer's mobile phone. The transaction is approved using an existing UPI app password. Cash can be withdrawn from ATMs after successful completion of this process.
It may take some time for banks to provide cardless services. The ATM software needs to be updated and other payment infrastructure needs to be set up. Therefore, some burden may also fall on the banks. Experts say this could allow banks to offer these services for a hefty fee.
