ATMs are profit centres, says Karnataka Bank MD

A significant volume of transactions at ATMs of Karnataka Bank comes from customers of other banks.

This was revealed at the 91st annual general meeting (AGM) of shareholders of the bank in Mangaluru on Thursday.

Replying to a query by a shareholder, who wanted to know the profit from ATM transactions, P Jayarama Bhat, Managing Director and Chief Executive Officer of the bank, said all the ATMs of the bank are profit centres.

However, he added, profits cannot be quantified as there are indirect benefits also.

“As and when we get more of acquired transactions (that is from other banks’ customers) we stand to gain. Around 60 per cent of our ATM transactions are from other banks’ customers,” he said, adding that the bank gets almost ₹15 a transaction from other banks.

As the number of transactions at ATMs increase, the number of transactions at branches reduces. If the cost of one transaction is around ₹47 at a branch, it is around ₹12 at an ATM.

“As and when transaction is transferred to ATM there will be indirect benefit to that extent. You can’t quantify that,” he said.

Karnataka Bank has a network of 675 branches and 1,000 ATMs.

Ananthakrishna, Non-Executive Chairman of the bank, chaired the annual general meeting.