Cardless cash withdrawals are here! India’s first ever UPI-ATM, how to withdraw money, features to its availability

Technology has significantly evolved across all sectors, from the era of traditional card-based transactions to the widespread use of UPI payments. Now, there's another exciting development on the horizon: the introduction of UPI ATMs. This groundbreaking innovation, recently unveiled at the Global Fintech Festival in Mumbai, brings cardless cash withdrawals into the spotlight.

With this innovative UPI ATM, the need for physical debit or credit cards at traditional ATMs becomes a thing of the past. Instead, customers can conveniently withdraw cash directly from their bank accounts using UPI apps. Internet users are celebrating this new feature as a transformative advancement in digital finance, offering enhanced convenience and security.

Meanwhile, business tycoon Anand Mahindra recently shared a video showcasing a man using a UPI-supported ATM, highlighting India's rapid digitisation of financial services.

What is a UPI-ATM & where was it launched?

On 5 September 2023, during the Global Fintech Fest in Mumbai, Hitachi Payment Services introduced India's first UPI-ATM in partnership with the National Payments Corporation of India (NPCI). This innovative ATM offers secure cash withdrawals without the need for physical cards.

This UPI-ATM, based on the Unified Payments Interface (UPI) operated by NPCI, allows people to instantly transfer money between their bank accounts. It's like having a regular ATM, but it doesn't require an ATM card. Instead, it lets customers of participating banks withdraw cash using their mobile phones and a special code. These types of ATMs are called white label ATMs, and they are managed by non-bank companies.

How to withdraw money from a UPI ATM?

Here's a step-by-step guide on how to withdraw money from a UPI ATM:

- Choose the 'UPI cash withdrawal' option at the ATM

- Input the desired withdrawal amount

- A unique, one-time dynamic QR code (signed) will appear on the ATM screen

- Scan the QR code using any UPI app

- Authorise the transaction with a UPI PIN on your mobile device (via the UPI app) to receive cash from the ATM

Key features of UPI-ATM

Here are the key features of the UPI-ATM:

- Card-less transactions: No physical card required for transactions.

- Transaction limit: Up to ₹10,000 per transaction, within the daily UPI limit and the issuer bank's set limits for UPI-ATM.

- Multiple account access: Allows cash withdrawal from multiple accounts using a UPI app.

How does UPI-ATM differ from cardless cash withdrawals?

The UPI-ATM and cardless cash withdrawals both offer convenient ways to get cash without using a physical card. However, they use different methods.

Cardless cash withdrawals usually involve your mobile phone and a one-time password (OTP) for verification. On the other hand, the UPI-ATM uses QR codes for cash withdrawals. This means you can scan a special code displayed on the ATM screen with your mobile phone to get cash.

In simple terms, both options make it easier to get cash from an ATM without needing your debit card. The UPI-ATM, with its QR code method, adds more convenience and security to traditional ATM services.

Response from the audience

In response to Mahindra's tweet, an Instagram user noted that credit card companies could also experience an impact. They mentioned that UPI has already influenced payment habits, with many transactions that were previously done with credit cards for convenience now being conducted through apps like Gpay or PhonePe.

As digital India continues to expand, its potential to revolutionise various sectors remains promising, with innovation poised to bring even more opportunities to the table.