Govt Seeks Detailed Information From Banks On Cash Shortages In ATMs

The Department of Financial Services (DFS) has sought detailed information from banks following reports of cash shortages at several ATMs across the country, raising concerns about the availability of cash for customers.

According to a report by Business Standard, the DFS has asked both public and private sector banks to provide details on ATM cash availability, replenishment processes, and any operational issues that may be affecting cash supplies. The move comes after complaints from customers in some regions about ATMs running out of cash for extended periods.

The government’s intervention follows concerns that disruptions in cash logistics and rising demand for physical currency may have contributed to the shortages. Officials have reportedly sought district-wise and bank-wise information to assess the scale of the problem and identify areas facing acute cash stress.

Banking authorities have indicated that the issue is not linked to any systemic shortage of currency in the financial system. Instead, the shortages appear to be localised and linked to cash management and distribution challenges. Banks have been instructed to ensure that ATMs are adequately stocked and that cash replenishment schedules are maintained efficiently.

Industry officials said that banks are reviewing ATM operations and coordinating with cash management companies responsible for transporting and loading currency into machines. Some regions may have witnessed temporary disruptions due to logistical challenges, higher-than-usual withdrawals, or delays in cash movement.

Meanwhile, the Reserve Bank of India (RBI) Governor Sanjay Malhotra last week said there is adequate currency available in the system, adding that any cash shortages at ATMs would be addressed promptly. Malhotra said that the RBI has sufficient currency stocks and would ensure that cash reaches locations facing shortages without delay. Concerns over reduced rupee liquidity in the banking system come as the domestic currency has come under pressure due to the Iran war.

The DFS is also monitoring the situation closely to prevent inconvenience to customers and to maintain confidence in the banking system. Officials have emphasised that sufficient currency is available with the banking sector and that customers need not panic.

The government’s review is aimed at ensuring banks strengthen monitoring mechanisms and address any gaps in cash distribution networks amid ongoing external volatility. Banks are expected to submit their reports to the DFS, after which authorities may issue further directions if necessary.