The Reserve Bank of India recently proposed to make cash withdrawal from ATMs possible without the need of a card
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The Reserve Bank of India recently proposed to make cash withdrawal from ATMs possible without the need of a card.
The service will be made available to all bank customers across all ATM machines, the RBI said.
“At present the facility of cardless cash withdrawal through ATMs is limited only to a few banks. It is now proposed to make cardless cash withdrawal facility available across all banks and ATM networks using the UPI,” RBI Governor Shaktikanta Das said at the Monetary Policy Committee (MPC) on Friday.
“In addition to enhancing ease of transactions, the absence of the need for physical cards for such transactions would help prevent frauds such as card skimming, card cloning, etc,” Das added.
How will the Cardless Cash Withdrawal System work?
The service will allow a customer of any bank to withdraw money without the use of their debit or credit card at an ATM machine. This will be made available to bank customers with the help of UPI or Unified Payments Interface, developed by the NPCI.
Even though it is not entirely clear as to how the system will work through UPI, it is likely that an option to withdraw money through UPI will soon start showing at ATM machines.
How to avail the cardless cash withdrawal facility?
Currently, a few banks like ICICI Bank, Kotak Mahindra Bank, HDFC Bank and SBI allow their customers to withdraw cash without using a card.
The facility can be initiated by customers of these banks through mobile and internet banking.
Some banks also allow this facility at ATMs where it is activated by default.
At a cardless cash facility-enabled ATM, an individual can withdraw money by entering a One Time Password when prompted.
Also, once the cardless cash facility through UPI is enabled on ATM machines, customers would be able to transact even more securely.
Upon selecting the option to withdraw cash through UPI, a user would be asked to input the amount of money they wish to withdraw. The ATM machine will generate a QR code, which the user will have to scan through their UPI app and enter the pin. Upon successfully entering the correct details, the ATM machine will dispense the desired amount of cash, as per a report by the Indian Express.
According to Das, allowing cash withdrawals through UPI would increase the security of such transactions. “In addition to enhancing ease of transactions, the absence of the need for physical cards for such transactions would help prevent frauds such as card skimming and card cloning, among others,” the RBI Governor informed.
With inputs from agencies
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