The Reserve Bank of India (RBI) on Friday decided to permit all banks to introduce card-less cash withdrawal through ATMs. Currently, card-less cash withdrawal through ATMs is a permitted mode of transaction offered by a few banks in the country on an on-us basis.

“It is now proposed to make card-less cash withdrawal facility available across all banks and ATM networks using the UPI. In addition to enhancing ease of transactions, the absence of the need for physical card for such transactions would help prevent frauds such as card skimming, card cloning, etc,” RBI Governor Shaktikanta Das said while announcing bi-monthly monetary policy review.

“Apart from making digital payments seamless, one of the biggest contributions of UPI was facilitating a standardised flow for secure authentication to a bank account. This use case was made ubiquitous with the ability to integrate not just with banking apps but third party apps like Google Pay and PhonePe as well. There are a lot more use cases for UPI and this is what we are seeing with cardless withdrawals from ATMs. While some banks have enabled this already, it’s great to see that all banks would soon support this feature, which would further increase convenience and improve security,” said Sumit Gwalani, co-founder of neobank Fi.

“The measures to allow inter-operability in card-less withdrawal at banks will give a further impetus to QR code-enabled payments. The decision to set up a robust governance structure for digital payments is a logical corollary of this move,” said Dinesh Khara, Chairman, SBI.

What is a cardless cash withdrawal?

The cardless cash withdrawal facility does not require bank customers to use their debit or credit cards while withdrawing cash from ATMs. 

  • 24X7 service to withdraw cash, anywhere in India
  • Safe and secure mode of cash withdrawal
  • Obtain the cash instantly without any ATM card
  • Under the card-less cash withdrawal facility, a customer is not required to use his/her debit or credit cards while withdrawing cash from ATMs.
  • This system uses a mobile PIN to generate cash.
  • The cardless cash withdrawal system uses the UPI facility to carry out the work.
  • The cardless cash withdrawal facility can be used for the self-withdrawal of money. 
  • However, not many banks have this facility yet and there is a daily transaction limit. 
  • The cardholder mostly has to use a mobile banking app and raise a request to withdraw cash at the ATMs if they do not possess their debit cards.

Banks having cardless cash withdrawals facility

Cardholders of various banks including SBI, ICICI Bank, and Bank of Baroda, among others, can withdraw cash even without their debit cards, through their phones. 

Here’s how the cardless cash withdrawal facility works:

  • The cardless cash withdrawal facility can be initiated by savings account holders through mobile and internet banking. 
  • Some banks allow this facility through cardless cash withdrawal-enabled ATMs.
  • The recipient has to visit the cardless cash withdrawal-enabled ATMs, where cash can be withdrawn after entering the code received on the mobile number.
  • Such transactions are capped at ₹5,000 or ₹10,000. 
  • There’s also a cap on the maximum amount that can be transacted per account in a day.