KARACHI: Non-bank entities can now own and operate automated teller machines (ATMs) and charge their own service fee on offsite locations, the State Bank of Pakistan (SBP) announced on Monday.

“The potential of ATM growth lies at offsite locations, which are still an untapped area,” the SBP said.

Although several banks have installed ATMs at offsite locations, operation and maintenance of these machines are a big challenge, it added.

Machines that are owned and operated by non-bank entities are called White Label ATMs. These entities are usually referred to as White Label ATM Operators (WLAOs).

The SBP said White Label ATMs can catalyse the growth of offsite ATMs to bridge the gap at a faster pace.

“The WLAO operates its ATMs in the Off-Us mode and becomes a member of an ATM Switch (Payment Systems Operator) for routing and settlement of transactions while the service fee and place of installation are decided by the WLAO itself,” said the SBP.

In order to encourage the growth of off-site machines through White Label ATMs, the SBP has developed Draft White Label ATMs Guidelines to provide a regulatory direction to prospective investors/service-providers that intend to apply for in-principle approval under the Rules for Payment Systems Operators and Payment Service-Providers, it said.

Published in Dawn, August 8th, 2017