Difference between White Label ATM and Brown Label ATM – ATM stands for Automated Teller Machine, is an electric machine which provide ease to operate the bank account for deposit and withdrawal of cash from the account. A customer can easily withdraw the cash on a single swipe of ATM card and entering confidential pin. ATM has made the operation of bank account very easy. Now you don’t need to go to bank branch and fill form to withdraw cash from your bank account. All you know about the word ATM but when you hear white label ATM and Brown Label ATM, we often get confused about these words.
Before discussing about White Label ATM and Brown Label ATM and differences between them, here you need to know that ATMs can be classified into three categories –
- Bank owned ATMs
- Brown Label ATMs
- White Label ATMs
These categories of ATMs are on the basis of ownership of ATM, ATM location, service contract of bank with service provider.
What are Bank Owned ATMs ?
Such ATMs are set up and owned by the bank itself. Bank is responsible for their operation and maintenance. Banks are entitled with responsibility of cash loading, AMC, security of the ATMs.
ATMs may also be categorized in two types on the basis of location – (i) ONSITE ATM (ii) OFFSITE ATM
ONSITE ATM – These ATMs are located at the premises of the bank branch.
OFFSITE ATM – Offsite ATMs are located at a location away from the bank premises. They are generally setup at important places like Railway Station, College or University Campus, Airports, Bus Stand, Market etc. with an aim to provide of ease of cash withdrawal to travelers, students and general public.
What are Brown Label ATMs ?
In case of Brown Label ATMs, service providers own the hardware of ATM machine. The responsibility of identifying ATM site, lease agreement with landlord, power supply to ATM kiosk lies with the service provider. Thus, service provider takes the responsibility of maintenance of the ATM whereas sponsor bank takes the responsibility of cash management and provide connectivity to ATM to banking network.
Logo of sponsor bank is displayed on brown label ATM kiosk premises. Brown Label ATMs are most cost effective solution for the banks.
What are White Label ATMs ?
White Label ATMs are owned and operated by Non Banking Financial Companies (NBFC). RBI has granted license or permission to non-banking entities to open such ATMs. Any non-banking entity with a minimum net worth of ₹ 100 crore can apply for white label ATM.
NBFCs rely on sponsor bank to settle all issues related to cash management, transaction settlement with other banks etc. Customers with debit card of any bank may withdraw cash from such ATMs but they will have to pay a fee for the services.
Unlike Brown Label ATMs, White Label ATMs will not display logo of any bank like SBI, CANARA BANK, PNB ETC. Logo of White Label ATM operator like Tata Indicash, Muthoot Finance etc.
Note : Tata Communications Payment Solutions Limited is the first company to get RBI’s license to open WLAs. They have started their Chain under brand name “INDICASH”.
Setting up of White Label ATMs are beneficial for customers as well as banks. With the expansion of ATM network, there will more locations where it will be convenient for customers to withdraw cash.
White Label ATMs also reduce the pre transaction cost for banks and there is no hassle to maintain and run such a payment channel.
What is difference between Brown Label ATM and White Label ATM ?
|White Label ATM||Brown Label ATM|
|ATMs are owned and operated by non-banking entities but there is no outsourced contract from a particular bank.||Bank outsource the operation of ATM to a third party such as cash management, lease agreement, power supply etc.|
|Non-banking entity or WLAs operator operates the ATM machine, pay rent, electricity supply, telecom bill etc.||In this also, service provider takes out such responsibilities.|
|Cash to load in ATM is provided by the sponsor bank.||The bank which has outsourced the operation supply the cash for ATM.|
|White Label ATM do not have logo of any bank but they have logo of non-banking entity who own and operate the ATM machine.||ATM has logo of that bank which has outsourced the work.|
|RBI directly involved because non-banking entity have to get license/ permission to run such ATMs.||In this, RBI is not involved directly. The outsourcing company have contractual obligation with their respective bank.|