The Demonetisation move has got most people up in arms about the lack of cash in ATMs and banks, with many asking why there cannot be a quick disbursal of lower denomination notes. Here are a few points that will help you understand recalibration
Photo Credits: PG1. LEAD
The ATMs are dispensing Rs 100s across the nation aren’t calibrated to dispense the new Rs 500 or Rs 2,000 notes. They cannot even dispense notes of lower denominations like Rs 50, 20 and 10. You only received those denominations when you withdrew at the branch. The only exceptions to that rule were at ATMs in the interiors of India, not Goa. So why can’t they just introduce Rs 100 and below into ATMs to solve our problems? The reason is because it’s not as easy as it sounds, or looks.
Finance Minister Arun Jaitley called it a massive operation and said that would take about two to three weeks. The reason for not calibrating the ATMs earlier was to maintain secrecy as the task involves thousands of people.If you are wondering what all the fuss around recalibration is about, here’s what you need to know.
How the ATM works
In an ATM, there are ‘cassettes’ configured to dispense Rs 1,000, Rs 500 and Rs 100 notes. An ATM cassette is specifically designed to fit an ATM and help dispense cash out properly. A single cassette will contain anywhere between 2,000 to 2,500 currency bills.
These cassettes have an electronic setting at the back-end, so, when docked to a machine, it will tell the machine that the cassette is configured for Rs 10,000. Then there is the software setting that helps dispense the types of notes. For instance, a cassette is configured for Rs 1,000 notes, and likewise two other cassettes carry denominations of Rs 500 and Rs 100. When you withdraw Rs 3000, the software will pick up one or two notes of Rs 1,000 and the remainder in Rs 500 or Rs 100 notes, which will depend on the logic built into the machine. The banks usually decide on the software logic behind the dispensing of cash.
Why the need for recalibration
The new currency notes — Rs 500 and Rs 2,000 — are slightly smaller in size as the width of the these notes is slightly smaller. Recalibration means that banks will have to remove the Rs 1,000 cassette setting and replace it with a new setting to match the new Rs 2,000 notes. Clearly, this will involve some software as well as hardware changes.
Since, the new notes are slightly smaller, there is the need to adjust the grilles that hold these notes inside the cassette. A type of railing is fitted within, which ensures that these notes are dispensed one by one and pushed by a push-plate. In front of the cassette, there are rollers that pull these notes one by one and then push them out. So, it is important that the notes be set up in a way that helps dispensing them in a smooth manner one by one without any folds or the possibility of them getting stuck. Essentially, the railings will have to be adjusted to hold the new smaller notes firmly, and the software related to cassettes will also have to be changed.
Now, the uphill task is to ensure cash availability, availability of the engineer to reprogramme the casettes, cash service agency or bank custodian all at the same place and time, and then manage the same for an entire network across Goa. Depending upon its network, it may not take 2-3 weeks.
