India1 Payments to expand white-label ATM network to 20,000 units in 3 yrs

India1 Payments backed by ICICI Ventures, an automated teller machine (ATM) company, plans to expand its network from the current 12,500 units to more than 20,000 units in the next three years.

A capital expenditure of Rs 120-150 crore per annum will be incurred over the next three years for network expansion and replacement of existing units in semi-urban and rural areas.

K Srinivas, Managing Director and CEO of India1 Payments, said the network expansion will be funded through internal sources. “The rise in inside change fees for ATM transactions in 2021 has improved our cash generation to spend on our own expansion and we don’t need to borrow,” he said.

White-label ATMs are units operated by a non-banking organization that allow customers of any bank to withdraw money and receive other value-added services. The total number of ATMs in the country was 259,000 at the end of March. Among them, 36,000 are white-label ATMs, according to data from the Reserve Bank of India. Other major players in the white-level ATM field include Hitachi Payment, Tata Communications Payment Solutions and Vakrangee.

At present, white label ATMs account for 15 percent of all ATMs in India. In developed countries, this share is more than 60 percent. Srinivas said there is a lot of scope to expand the network to meet customer requirements.

Although it has filed a prospectus with the Securities and Exchange Board of India for the proposed listing, there is no clarification of when it will hit the market. Company officials said the decision on the timing of an initial public offering (IPO) rests with shareholders.

The shareholders (Promoters Group and ICICI Ventures) have injected more than Rs 450 crore since the inception of the company. ICICI Ventures acquired 48.95 per cent stake in India1 Payments during the financial year 2014.