Introducing 'Virtual ATM': No ATM visit needed, obtain cash from nearby shops using OTP; here's how
By Team Asianet Newsable | First Published Feb 13, 2024, 8:50 PM ISTPaymart India introduces virtual ATM service, facilitating cash withdrawals from shopkeepers using smartphones, without traditional ATM or card PIN, especially beneficial in remote areas.
The widespread adoption of Unified Payments Interface (UPI) has transformed the way people handle transactions, with many now forgoing cash when venturing out. With just a smartphone and internet connection, individuals can conveniently make online payments. However, this reliance on digital methods has led to a new challenge: the redundancy of carrying debit and credit cards. This poses an issue, particularly in emergencies or while traveling in remote areas, where access to cash is imperative. Finding a functional ATM and remembering one's card for quick cash withdrawal can be cumbersome.
Paymart India has introduced a solution to address this inconvenience. The Chandigarh-based fintech company offers a virtual, cardless, and hardware-less cash withdrawal service. The innovation allows users to withdraw cash from nearby shopkeepers using only their smartphones, eliminating the need to visit an ATM or recall their card PIN. Amit Narang, Founder & CEO of Paymart India Pvt Ltd, calls this service “Virtual ATM”.
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How to withdraw money using a virtual ATM
To utilize a virtual ATM for cash withdrawals, you'll require a smartphone, a mobile banking application, and an active Internet connection. Begin by initiating a withdrawal request through your mobile banking app, ensuring that your phone number is registered with your bank for app access.
Upon request, your bank will generate an OTP and send it to your registered number. Simply display the OTP to the nearest shop partnered with PayMart to collect your cash from the shopkeeper, as explained by Narang.
Your mobile banking app will display a directory of registered shopkeepers offering virtual ATM services through PayMart, complete with names, locations, and contact numbers. "No debit card or traditional ATM machine or kiosk or UPI is required to make the withdrawal," Narang was quoted as saying in Economic Times. The shopkeeper effectively serves as a virtual ATM, facilitating cash transactions through the merchant portal, www.vatm.in.
This service proves particularly valuable for individuals residing in or traveling to remote areas where finding an ATM can be challenging, but shops accepting digital payments are accessible.
Who can use this virtual ATM?
According to a statement released by Paymart, the virtual ATM service has undergone a successful pilot phase with IDBI Bank for over six months. The fintech company has further collaborated with Indian Bank, Jammu & Kashmir Bank, and Karur Vysya Bank to introduce this service.
At present, the virtual ATM service is accessible only at specific locations in Chandigarh, Delhi, Hyderabad, Chennai, and Mumbai, as confirmed by Narang. By March, Paymart intends to commence pilot programs with its partner banks as part of a phased nationwide launch. The company aims to achieve this objective by April or May 2024 and is currently engaged in advanced discussions with four additional banks for potential collaboration.
Moreover, Paymart has partnered with CSC e-Governance Services India Limited to extend the reach of its virtual ATM service. Leveraging over five lakh locations across the nation, this collaboration aims to facilitate cash withdrawals.
For the time being, customers are not subjected to any charges for utilizing this virtual ATM service, as highlighted by Narang.
How much money can you withdraw using virtual ATMs?
Narang explains that users can withdraw a minimum of Rs 100 and a maximum of Rs 2,000 per transaction using this facility. Additionally, there is a monthly withdrawal limit of Rs 10,000 through virtual ATMs, as specified by Narang. While the virtual ATM proves advantageous for obtaining small amounts, it may not be the most suitable option for large withdrawals, as shopkeepers may have limited cash on hand.
How will Virtual ATM help banks?
Highlighting the benefits of the new ATM service, Paymart explains, "Virtual ATMs help banks to serve customers in underserved areas. The cost of installing and maintaining a traditional ATM will be eliminated. It also reduces footfall in the bank branches, especially in remote areas."
Additionally, shopkeepers affiliated with Paymart will earn commissions on transactions, generating new revenue streams. This increased customer footfall is expected to stimulate business growth, according to Paymart.
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