Days before Prime Minister Narendra Modi stunned with his announcement banning Rs 500 and 1,000 notes, the Reserve Bank of India had ordered banks to set up ATMs that would only dispense Rs 100 notes, reports news agency IANS.
"How many banks complied with this directive is not known," it said.
However, Arundhati Bhattacharya, who heads the State Bank of India, which is the country's largest lender, told NDTV, that "the instruction from the RBI was only in respect of one ATM per district... (so) one ATM per district was configured with only 100-rupee notes."
Since the old notes were declared invalid for transaction - a reform praised for its crackdown on black money - India has been waiting in line for the new currency (Rs 500 and Rs 2,000 notes). ATMs, which were meant to be operational on Thursday, are being reset to dispense the new notes, said Finance Minister Arun Jaitley on Saturday, adding that it could take three weeks for all cash machines to serve as needed.
"The technology takes about two-three weeks to recalibrate. The central switch needs to be changed and each machine needs to be altered individually, about 200,000 machines," Mr Jaitley said. "And because the size of the new notes is different, the machines are being recalibrated slowly." He said ATMs could not have been reconfigured ahead of time as it would have given "the whole game away".
Stating that to start with, 10 per cent of the ATMs in the country would be recalibrated, the RBI said that "as the process involved in configuring the requisite number of machines is not complex, the banks are required to complete the exercise within 15 days".
For now, old bills can be exchanged for limited amounts of the new notes; they can also be deposited until December 30 in banks, but customers will face major scrutiny by tax authorities if they cannot account for a sudden swell in their balance.
Analysts have broadly welcomed the decision, saying consumer spending would likely dip in the short term as the new notes made their way into circulation but that the move would boost GDP in the long term.
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