It’s hard to manage your money in a place like rural India. There aren’t any bank branches, and certainly aren’t any ATMs. That makes it hard to interact with the financial system and take advantage of even the most basic ideas of saving and interest.
That’s why ATM software company KAL is now deploying "cashless ATMs" that are trying to make branchless banking far cheaper and more ubiquitous by turning retailers into mini-banks in even the most remote communities. CEO of KAL ATM Software, Aravinda Korala, says that instead of withdrawing money from a cashless ATM, you would get an IOU that can be redeemed at local stores or merchants, essentially consolidating a remote community’s banking with a handful of individual bank account holders.
Korala expected the system to attract the most interest in developing countries such as India and China, but banks in Japan and the U.S. have also jumped on the concept to expand their own ATM networks at just one-tenth the cost of new ATMs, reports ATM Marketplace (which is actually a thing). Korala officially launched the company’s cashless Retail Teller Machine in New York’s Times Square this summer.
"We are going with this to be a complete bank teller machine," says Korala in ATM Marketplace. "Because this can do dispense, this can do deposit, this can do balance inquiry, this can do bill pay, this can do your whole kind of banking thing," as well as video conferencing with tellers in home offices.
By turning over the function to retailers, the ATM may extend financial services to some of the more than 2.5 billion adults around the world who don’t use banks, according to a World Bank project. Although a bigger problem faces most of them: Two-thirds report they are still too poor to make use of banks in the first place.