SUMMER INTERNSHIP PROJECT REPORT

ON

VIABILITY OF ATM IN RURAL MARKETS WITH

CO-OPERATIVE BANKS PERSPECTIVE

SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS OF MBA

PROGRAM OF SCHOOL OF MANAGEMENT, GD GOENKA UNIVERSITY,
GURUGRAM

ACADEMIC SESSION

2019-2020

UNDER THE GUIDANCE OF:

MS. MANSI MISHRA

ASSISTANT MANAGER-BUSINESS PROCESS FINANCE & OPERATION

SUBMITTED BY:

SAKSHI
ENROLMENT NO: 180010301043
 GD GOENKA UNIVERSITY
SOHNA ROAD, GURUGRAM – 122103, HARYANA, INDIA
 Declaration by the Student

I the undersigned solemnly declare that the project reported Viability of ATM in rural markets
with co-operative banks perspective , is based on my own work carried out during the course of
the internship under the supervision of Ms. Mansi Mishra

I assert the statement made and conclusions drawn are an outcome of my research work. I further
specify that:

I. The work contained in this report is original and has been done by me under the general
supervision of my supervisor.
II. The work will be submitted in GD Goenka University, Gurugram for partial fulfillment of
requirement of MBA program of School of Management.
III. I have followed the guidelines provided by the university in writing the report.

Name: Sakshi
Enrolment No.: 180010301043
Signature:
 Certificate from the Guide

This is to certify that Ms. SAKSHI MBA (2018-20 Batch) a student of G D Goenka University,
Gurugram, has undertaken the project on “Viability of ATM in rural markets with co-operative
banks perspective”. To the best of my knowledge, the survey, data collection, & analysis work for
preparing the project has been carried out by the student in partial fulfillment of the requirements
for the award of MBA, under my guidance and supervision. I am satisfied with the work of Ms.
SAKSHI

Signature of Guide :

Name, Designation & Address : Ms. Mansi Mishra, Assistant Manager- Business

Process & Noida Sector 142

Date : 08/07/2019

Place : Gurugram, India

 Acknowledgment

The internship opportunity I had with Origin ACD IT Solutions Pvt Ltd was a great chance for
learning and professional development. Therefore, I would like to thank Mr Varun Mishra, HR
Manager, who not only hired me but helped me in completing my report in every possible way.

Secondly, I would like to thank my Industry Mentor , Ms. Mansi Mishra, who was there with me
at every instance to guide me and to push me whenever necessary.

I express my deepest gratitude to my Mentor, who not only supported me but also trusted with
responsibility of the layout of the project. This support and encouragement has been a source of
inspiration for me and made my journey in Origin ACD IT Solution Pvt. Ltd. a delight.

I would like to give a special thanks to Ms Mansi Mishra, who supported me throughout the
project with utmost cooperation and patience. I am very much thankful to you, for sparing your
precious and valuable time for me and for helping me in this project

My thanks and appreciations also go to my mentor Dr. Suneel Arora in developing the project and
people who have willingly helped me out with their abilities.
 Executive Summary

In my 6 weeks of Internship at Origin ACD IT Solutions Pvt Ltd., starting from 1 st July 2019 and
ending on 10th August 2019, I was able to gain ample understanding of the banking sector and IT
industry in India and the future prospects and opportunities in the field moving ahead. I was able
to perform some analysis of various aspects of cost of the ATM’s by Origin ACD IT Solution Pvt
Ltd. In the city of Meerut and Dehradun. IT industry in India is expected to flourish in coming
years and thus it is important to drive the operations of the organization in the right direct moving
ahead. My study here covered a vast and various aspects such as expenditure, revenues and the co-
operative banks etc. Through my course of study here I was able to understand that continuous
expenditure for the ATM and then to meet out their expenditure by generating revenues with
transactions done by the customers whether it is financial or non-financial. In my course of study,
I found out that Origin ACD IT Solutions Pvt Ltd., has year on year strived towards the break-
even point where the banks get their revenue above the expenditures for start making the profits
and matching out their revenue with the population making the transaction per month.
Table of Content
 Industry Overview

Technology has continued to take the world by surprise, enabling an industrial revolution,
economic change as well as social transformation. Information technology is not any exception –
its evolution, advancements and results still unfold to spread at a rapid pace, as will humanity’s
dependence on technology generally.

Information Technology basically refers to digital process, storage, and communication of data of
all types. IT are often outlined as computing and telecommunication technologies that give
automatic means that of handling data. data Technology has created data access at our disposal
and discretion. it's revolutionized our daily lives through the web with potentialities of e-
government measures. Today, whether or not it’s booking a gas affiliation or paying taxes on-line
or execution a fund transfer, it's simply a couple of mouse clicks away.

the knowledge Technology trade is one among the world’s largest and fastest-growing industries.
it's progressively finding applications altogether sectors of the economy and therefore is accepted
as a key enabler in development. within the last 20 years, the knowledge and forty eight
Communication Technology (ICT) sector in India has emerged speedily on the world stage.
India’s IT potential is on a gentle march towards international fight, increasing energy potency
and meeting environmental challenges amongst others.

The IT sector is generally categorized into IT services and package, data technology-enabled
services (ITeS) and IT hardware merchandise section. IT Hardware section includes personal
storage devices, printers, servers, Personal Computers (PCs), supercomputers, processing
instrumentation and peripherals like monitors, keyboards, disk drives, plotters, SMPS, modems,
networking merchandise, and add-on cards. international hardware production is focused within
the Asia–Pacific and also the North yank region. Singapore, Taiwan, China, Thailand, and Korean
Peninsula area unit the most important producers and exporters of element and peripherals within
the world. Branded notebook computer majors like Hewlett Packard, IBM, and holler source their
production to Asian countries and specialize in selling and services.

Information Technology (IT) sector in India is one of the rapidly growing sectors. Indian IT sector
has a great reputation and brand value in the global markets. Indian IT industry comprises of
Software sector and Information Technology Enables Services (ITES). Indian IT industry also
includes Business Process Outsourcing (BPO) industry. India is an affordable market destination
for software development and IT & ITES services.

According to an article in the Times of India, India's liberalization was possible due to its IT
industry. In the 1990s, the industry started off with an export of nearly $100 million with around
5,000 employees. Now it is an industry that thrives globally and India's IT exports are now around
$70 billion with 2.8 million employees working in this sector. The article states that the IT sector
is one of the top two industries in the country today.

India's IT industry is expected to grow at a rate of 12 - 14% during 2016 - 2017 as per a report by
India's software industry body National Association of Software and Services Companies
(NASSCOM.) This clearly shows that information technology is a sector which will likely be one
of the emerging markets in the days to come as India's economy requires more hardware, software
and other IT services. In a NASSCOM-McKinsey report, India's position in the global offshore IT
industry is based on five factors - abundant talent, creation of urban infrastructure, operational
excellence, conducive business environment and finally, continued growth in the domestic IT
sector.

Domestic revenues are anticipated to grow 10 to 12% to $28-29 billion in the financial year 2018-
19. Information technology body Nasscom anticipates the IT sector to increase at 7 at 9 % in the
financial year 2018-19.Indian IT industry’s export revenues will increase to $135-137 billion from
the $126 billion anticipated for the 2018-19. The industry body had forecasted 7 to 8% growth for
the previous financial year.

India’s IT & ITeS industry grew to US$ 181 billion in 2018-19. Exports from the industry
increased to US$ 137 billion in FY19 while domestic revenues (including hardware) advanced to
US$ 44 billion. Spending on Information Technology in India is expected to grow over 9 per cent
to reach US$ 87.1 billion in 2018. Revenue from digital segment is expected to comprise 38 per
cent of the forecasted US$ 350 billion industry revenue by 2025.

Indian IT/ITeS Sector is growing substantially with its

 Expansion into varied verticals

 Well differentiated service offerings
 Increasing geographic penetration
The phenomenon success of the Indian IT/ITeS industry can be attributed to the favourable
government policies, burgeoning demand conditions, healthy group of related industries and
competitive environment prevalent in the industry. The interplay of these forces has led to putting
the industry on the global map.

India is a well-known sourcing destination across the world, accounting for about 55 % market
share global services sourcing business. India has a share of about 38 % in the overall Business
Process Management (BPM) sourcing market.

History and Evolution of IT Industry

The evolution of IT industry can be studied in 4 phases :

Phase I: Prior to 1980

The software industry was literally non-existent in India until 1960.Software used in the
computers till that time, were in built with the systems. Government protected the hardware
industry through high tariff barriers and licensing. However, in the West, the need for software
development was gradually being felt as the software in built in the system was not sufficient to
perform all the operations. The Government of India therefore, realized the potential for earning
foreign exchange.

In 1972, the government formulated the Software Export Scheme. This scheme made the
provision of hardware imports in exchange of software exports. TCS became the first firm to
agree to this condition. The year 1974 marked the beginning of Software exports from India.

Phase II: 1980 to 1990

Despite the government initiatives, the software exports were not picking up because of two
reasons mainly:

 The exports of software, was heavily dependent on the imports of hardware, which was
costly as well as the procedure for obtaining the same was very cumbersome.
 Secondly, there was a lack of infrastructure facilities for software development.
To counter these, the government formulate New Computer Policy in 1984, which simplified
import procedures and also reduced the import duty on hardware for software developers. In an
attempt to make, software industry independent of the hardware industry, the government in 1986,
formulated Software Policy which further, liberalized the IT industry. According to this policy,
the hardware imports were de-licensed and were also made duty free for the exporters. This along
with the world wide crash in the hardware prices reduced the entry barriers substantially.

In 1990, government established Software Technology Parks of India. This scheme was
formulated to increase the exports of software and services.

Phase III: 1990 to 2000

This decade made several significant changes in the economy, including trade liberalization,
opening up of Indian economy to foreign investment, devaluation of the money and relaxation of
entry barriers. These changes attracted many foreign entities (MNCs) to our nation. These MNCs
in India, introduced ‘Offshore Model’ for software services, according to which, the companies
used to service their clients from India itself. This model further graduated to Global Delivery
Model (GDM).Global Delivery Model is a combination of On-site and Offshore Model. In this
model, the Offshore Development Centre is located at various locations across the globe.

During this period due to the entry of many players in the Indian market the competition got
intensified. Therefore, the players started investing in research and development to distinguish
their services from others.

Phase IV: Post 2000

The global problems like the Y2K, the dotcom crash and recession in the US economy, proved to
be a boon to Indian IT industry. The Y2K problem demanded the existing software to be
compatible to the year 2000. Due to the shortage of US based programme during this period,
many mid-sized firms were forced to utilize the services of Indian firms. This had placed the
Indian IT industry on the global map.

Post 2002-03, the industry had registered a robust growth rate because of increase in the number
of clients, large sized contracts and a strong global delivery model.
Industry Segmentation

IT industry can be broadly classified into three categories:

 Software’s
 IT Services
 IT enables Services (ITeS) – BPO
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India is an abundant house of technical manpower being home for the world's finest IT service
provider companies from major cities of India such as - Bangalore, Delhi, Mumbai, Kolkata,
Chennai, Pune, and Hyderabad. Today, India is the 3rd faster-growing market for software
enterprise.

India has become one of the largest global outsourcing destination across the globe with a 55%
market share. IT industry contributes to 3rd ranking Foreign Direct Investment (FDI) share. India
has a 35% share in Business Process Management (BPM) share. IT sector contributes to 7.7% to
India's GDP. India has more than 5000 start-ups with 1200 start-ups being added in 2018.
 Company Overview

Origin ACD IT Solutions Private Limited is a private incorporated on 09 October 2014. It is

classified as Non-government Company and is registered at Registrar of Companies, Delhi. Its
authorized share capital is Rs. 5,00,000 and its paid up capital is Rs. 1,00,000.  It is involved in
Software publishing, consultancy and supply [Software publishing includes production, supply
and documentation of ready-made (non-customized) software, operating systems software,
business & other applications software, computer games software for all platforms. Consultancy
includes providing the best solution in the form of custom software after analyzing the user’s
needs and problems. Custom software also includes made-to-order software based on orders from
specific users. Also, included are writing of software of any kind following directives of the users;
software maintenance, web-page design]. Directors of Origin ACD IT Solutions Private Limited
are Deepak Singh Adhikari, Abhijit Sharma, Mayur Garg, Kanushree Garg, .Region of operation
of Origin ACD IT Solutions Private Limited is Northern Region of India.

‘Ideas to Action’ is what Origin ACD IT Solutions, leading Fin-tech service provider of the
country stands for. Delivering IT enabled business solutions to small, medium and large sized
businesses, institutions and government agencies across India, Origin ACD IT Solutions has been
playing a significant role in contributing to the Fin-tech revolution in the country. We are
committed to deliver perfect resolutions to real world business issues.

Various Products offering under Origin ACD IT Solutions Private Limited are Cheque Truncation
System, Mobile Cheque Truncation System, Primary Agricultural Credit Society, Centralized
Know Your Customer, National Automated Clearing House, O-RECON, Document Management
System, Core Banking System, Human Resource Management System, Automated Teller
Machine, Point of Sales Machines, KIOSK Machine and Project Cocoon (Academic ERP).

They have some value clients such as NPCI (National Payment Corporation of India0, Punjab and
Sind Bank, ICICI Bank, HDFC Bank, Yes Bank, Indulsand Bank, IDBI Bank and Capital Bank
and many more.

Origin Company has been started by four friends. As they all have completed their B.tech and
entering into the corporate world they plan to start their own company so they planned and they
open Origin ACD IT Solution Private Limited.
As it is the start up company it has its office in Noida only, where as it has no further
departments.As my head is the assistant manager-Business Process Finance & Operations which
shows that my seniors used to work for multiple divisions. Similarly there were other employees
who work for the finance as well as for marketing profile.

Origin also have bifurcation for their revenue :

 Sales Hardware 30%

 Sales License 15%

 Sales Rentals 31% and,

 Sales Others 24%

Sales Others
24% Sales Hardware
30%

Sales License
Sales Rentals 15%
31%

Sales Hardware Sales License Sales Rentals Sales Others

Journey of Origin ACD IT Solutions Private Limited

2014 : In this year it started its journey by entering into the world.

2015: In this year customer get on board in the company. Customers get aware
about the company.So they started becoming their client.

2016: In this year, company added one government department and 8 banks as their
clients.
2017: In this year, company added 10 more banks as their clients.

2018: By reaching this year they build up the operational relation with 60 banks
across the country.

Budget Adding Volume to Origin’s Volume Credibility

 Origin also provides technical consultancy services and delivers expert resolution in
designing, developing and integrating IT Solutions.

 They have approximately 150 thousand cheque being processed everyday using their
solutions with their clients including Capital Small Payment Banks and India Post to name a
few customers.

 Providing original innovations for smarter solutions;is what their highly skilled and
motivated team with excellent and technical and business knowledge works with.

Vision of Origin ACD IT Solution Private Limited

To be a company by choice empowering its customers with business and technology solutions.
We are passionate in helping businesses to realize their success dreams.

Mission of Origin ACD IT Solution Private Limited

 To passionately fulfil our commitments towards our Clients.

 To create worth and make difference with what we deliver.
 To inspire those with whom we connect.
 To provide an untouchable customer service experience

Values of Origin ACD IT Solution Private Limited

Theirs values serves as a compass for our actions and validate their operate as people and as a
company. They work as CLAPS

Collaboration: To leverage our collective intellect.

Leadership: The ability to own a vision and determination to execute that vision.
Accountability: Taking ownership and pride.
Passion: Being committed inside out.
Superiority: To deliver impeccable solutions

Origin of Origin ACD IT Solution Private Limited

Purpose of setting up the company is to act as a bridge to plug in the technology gaps between
Reserve Bank of India and Co-operative Banks . In this RBI demands technology updation to
meet efficiency and trends while Co-operative Banks possesses lesser technical know how to
implement and maintain technologies.

Services of Origin ACD IT Solutions Private Limited

There are various services which are used by Origin to maintain its Customer Relationship are :

 Effective Customer Relation Management

 Best Fit Solutions

 Target Oriented Approach

 24 X 7 After Sales Support

 Effective Implementation

 Time Saving Solution

 Multi - Dimensional Approach

 On Time Deliveries

 Efficient Team

 Process Oriented

 Proper Project Planning

 Value for money solutions

 Origin Business Model

Origin ACD IT Solutions Private Limited , have their own business model :

KEY PARTNERS

 NCR Corporation (ATM & Cash Recyclers)

 Canon (Cheque Scanners)

 Blackduck (Vulnerability Assessment Software)

 Constellation (WD- LAN Bonding)

KEY ACTIVITIES

 Innovative low cost solutions

 High ROI to partners

 Strong Product Support

 Rental Model for Software

KEY RESOURCES

 Highly skilled Support Team

 Right Contacts

 Strong Product Development

 Operating Cost Back Up

VALUE PROPOSITION

 Cost Effective Solutions

 Reduction in Capital Expense for Customer

 Providing all banking S/W and H/W

 Covering Co operative Bank Segment

 High Scalable Product

 Latest Trending Solutions

CUSTOMER RELATIONSHIPS

 Employee Activity Tracker

 Complaint Tracking System

 Customer Management System

CHANNELS

 We connect to our customers through personal visits

 Digital Marketing is also used sometimes

CUSTOMERS

 Cooperative Banks coming under government mandate

 Regional Rural Banks having high number of branches

 Small Banks with lesser number of branches

 Banks who are looking for innovative solutions

 Banks with limited financial strength to automate processes

COST STRUCTURE

 Extensive Travelling Cost

 Investment on technology upgradation

 Maintaining a Highly skilled development team

 Investment on Support activity we deal with financial transaction

REVENUE STREAMS
 Converting the customer to pay on rental model

 Customer is willing to pay for matured product free from technical issues

 Strategize to keep the solution at lowest possible rates and play on number

Executive Synopsis

Setting up of ATM and Software is a very essential part of any business, banks and company, it
will either make them or break them at any point of time. Thus, it is a very hot topic for many of
the company and a very difficult task to handle it precisely. The initial phase comprised of
undergoing the study of the company and their products which was necessary to start my journey
in Origin ACD IT Solutions Pvt. Ltd. . The second phase was to selecting the area for the
research. During this phase I was assigned to check for the cooperatives banks as well as the
population in the selected area. The last phase comprised of taking responsibilities of collecting
the data for the project I was assigned to and complete my project while using Net Present Value
method and Break Even Point. During the period of internship, I learned about how the banks set
up the ATM’s, what are the viabilities as well as the expenditure amount for setting up the ATM
and the areas of the revenues for meeting their expenditure. Moreover, in a deep analysis my
project revolved around analysis the cash flows of the banks and how to apply all the research data
on a real time basis. I was assigned to manage only the Automated Teller Machines. After getting
assigned to a particular layout my work started by learning about what the banks keeps in mind for
setting up the ATM. If the expenditure is found high during research then they check out the
transactions to be held within a month whether they are earning revenues for meeting up the
expenditure to be help for the ATM . After checking up and receiving the data they used to
finalize that in what areas or which places they have to cover for receiving the revenues. Now the
research end here and the agreements with the banks starts. It is in important step to keep a record
of the cooperative banks in rural areas and the population so that the company can provide them
the Automated Teller Machines and check out the expenditure that banks can made.. A IT and
banking Leader have to keep a regular check on these while managing all other products. IT
industry is a field where software is a constant challenge for the company. The more effective the
software the more growth can be there for the company. In this report I have presented all the
things I learned in the company that includes the working of ATM in rural banks with its pros and
cons
About the products of the Company
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About the partners of the company

For their partners their driving technology for leading brands. So the partners of the company are :

 Canon (Delighting you always)

Robosoft (Emotion Engineering and Design)
NCR (National Capital Region)
NEC (Nippon Electric Company)
Nelito (Solution that perform)

About the clients of the company

They called their clients valuable:



ICICI Bank
Capital Bank
 Punjab and Sind Bank
 Rajasthan Marudhara Bank
 NPCI
 The Panipat Urban Co-operative Bank Ltd.
 Sarv Harayana Gramin Bank
 The Delhi State Co-operative Bank
 HNG
 HDFC Bank
 IDBI Bank
 Indulsand Bank
 NPCI
 MIZHUO
 Bhartiye Dak
 The Nanded Merchant Co-operative Bank
 About the Project

During my internship my research is based on the basis of one of their product i.e. Automated
Teller Machine (ATM) which is necessary now a days. An ATM is an electronic
telecommunications device that enables customers of financial institutions to perform financial
transactions, such as cash withdrawals, deposits, transfer funds, or obtaining account information,
at any time and without the need for direct interaction with bank staff.

ATMs can be placed at any location but are most often placed near or inside banks, shopping
centres/malls, airports, railway stations, metro stations, grocery stores, petrol/gas stations,
restaurants, and other locations. ATMs are also found on cruise ships and on some US Navy ships,
where sailors can draw out their pay. In recent times, countries like India and some countries in
Africa are installing ATMs in rural areas, which are solar powered.

An ATM is typically made up of the following devices:

 CPU (to control the user interface and transaction devices)

 Magnetic or chip card reader (to identify the customer)
 a PIN pad for accepting and encrypting Personal identification number EPP4 (similar in
layout to a touch tone or calculator keypad), manufactured as part of a secure enclosure
 Secure crypto processor, generally within a secure enclosure
 Display (used by the customer for performing the transaction)
 Function key buttons (usually close to the display) or a touchscreen (used to select the
various aspects of the transaction)
 Record printer (to provide the customer with a record of the transaction)
 Vault (to store the parts of the machinery requiring restricted access)
 Housing (for aesthetics and to attach signage to)
 Sensors and indicators
Mechanisms found inside the vault may include:

 Dispensing mechanism (to provide cash or other items of value)

 Deposit mechanism including a cheque processing module and bulk note acceptor (to
allow the customer to make deposits)
 Security sensors (magnetic, thermal, seismic, gas)
 Locks (to ensure controlled access to the contents of the vault)
 Journaling systems; many are electronic (a sealed flash memory device based on in-house
standards) or a solid-state device (an actual printer) which accrues all records of activity
including access time stamps, number of notes dispensed, etc. This is considered sensitive
 data and is secured in similar fashion to the cash as it is a similar liability.

Types of Automated Teller Machine

White Label ATM’s: White Label ATMs are those ATMs which set up, owned and operated by
non-bank entities. To aid financial inclusion and drive ATM penetration in the country the
Reserve Bank of India has permitted the launch of White Labelled ATMs (WLAs) i.e. private
non-bank companies to set up, own and operate its own brand of ATMs in the country. These
white label ATMs will not display logo of any particular bank. TATA launched the first white
label ATM in India under the brand name of Indicash.

Brown Label ATM’s: These ATMs are owned and maintained by service provider whereas a
sponsor bank whose brand is used on ATM takes care of cash management and network
connectivity.

On-site ATM’s: These are ATM machines that are set up in the premises where there is a bank
branch so that both the physical branch and the ATM can be used. This is known as being on site
and this can be used for several purposes. Many people can use this to avoid the lines that are
present in the branch and hence save on the time required to complete their transactions.

Off-site ATM’s: These are the machines that are set up on a standalone basis. This means that the
bank has a place where there is only an ATM machine then this becomes an off-site ATM. This is
done to ensure that the bank reaches out to more geographical areas and that people are able to use
its services even when there is no bank branch in the area.

Uses of Automated Teller Machine

ATMs were originally developed as cash dispensers, and have evolved to provide many other
bank-related functions:

 Paying routine bills, fees, and taxes (utilities, phone bills, social security, legal fees,
income taxes, etc.)
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 Printing or ordering bank statements
 Updating passbooks
 Cash advances
 Cheque Processing Module
 Paying (in full or partially) the credit balance on a card linked to a specific current account.
 Transferring money between linked accounts (such as transferring between accounts)
 Deposit currency recognition, acceptance, and recycling

Advantages of ATM
 Withdrawing money.

 Checking how much money is remaining in the account.

 Round the Clock Services: ATM provides banking services to its customers round the
clock, 24 hours a day, 7 days a week and 365 days a year.

 Access to bank from any part of the world: Essential banking services like deposits,
withdrawals transfer of funds, etc. can be accessed by customers from any part of the world.

 Expansion of Services to any corner of the world: Of the Banks can expand their services
to any corner of the world by providing electronic access to its customers.

 For shopping Purpose: Now a day’s almost every shopping mall, restaurant and other
organizations are accepting debit or credit card payments.

Disadvantages of ATM
 If problem with credit card you cannot withdraw your money.
 If someone watches or hacks an ATM machine your details may be taken if you forget your
PIN number you cannot use the card.
 Cannot be provided in rural areas: In a country like India, where banks are having large
number of rural and non-computerized branches, ATM services cannot be provided.
 Limitation of cash withdrawals: Again there is a limitation of cash withdrawals from ATM.
For example, many banks do not permit withdrawal of more than 25,000 at a time.
 Cash deposit facility is not safe: Similarly cash deposit facility is restricted and not safe as
dropping of envelope and ATM is not advisable.
 Possibility of misusing ATM card: ATM card, if misplaced, lost or stolen, may be misused.
There are number of such reported incidences now a day.
 Loss of personal touch with the Banks: Last but not the least; customers lose personal touch
with their bankers

Rural Areas

Rural areas are areas which are not towns or cities. They are often farming or agricultural areas.
These areas are sometimes called "the country" or "countryside". People who live "in the country"
often live in small villages, but they might also live somewhere where there are no other houses
nearby. Typical rural areas have a low population density and small settlements. Agricultural areas
are commonly rural, as are other types of areas such as forest.

Rural Area in India

Rural areas are also known as the 'countryside' or a 'village' in India. It has a very low population
density. In rural areas, agriculture is the chief source of livelihood along with fishing, cottage
industries, pottery etc.

The quest to discover the real rural India still continues in great earnest. Almost every economic
agency today has a definition of rural India. Here are a few definitions: According to the Planning
Commission, a town with a maximum population of 15,000 is considered rural in nature. In these
areas the panchayat makes all the decisions. There are five persons in the panchayat. The National
Sample Survey Organization (NSSO) defines ‘rural’ as follows:

 An area with a population density of up to 400 per square kilometre,

 Villages with clear surveyed boundaries but no municipal board,
 A minimum of 75% of male working population involved in agriculture and allied
activities.

RBI defines rural areas as those areas with a population of less than 49,000 (tier -3 to tier-6 cities).

It is generally said that the rural areas house up to 70% of India's population. Rural India
contributes a large chunk to India's GDP by way of agriculture, self-employment, services,
construction etc. As per a strict measure used by the National Sample Survey in its 63rd round,
called monthly per capita expenditure, rural expenditure accounts for 55% of total national
monthly expenditure.
ATMs problem in Rural Area in India

The country is facing an acute shortage of ATMs, as there are only ATMs per lakh people. In a
country where only 16% of rural population transacts online, the shortage of ATMs is a big
concern as the majority of the country’s 134 crore population resides in the rural areas. Barely 5%
of the rural areas have access to an ATM. There are over 6 lakh villages in India, but not more
than 30,000 villages have ATMs. People from rural areas end up travelling at least 10km to access
any kind of banking and IT services which are useful in rural areas.

About my Project

In my summer internship, on behalf of my company I researched on the viability of ATMs in rural

areas in which I selected a particular area Mawana which is a small place of Uttar Pradesh which
has nearly a population of more than 81,443 in Mawana Nagar Palika Parishad. It also has 268
villages with the population of 5,85,122 (approx.)

In my project I checked out that what should be population and what are the expenses that the
banks have to bear for setting up the ATM. In which they have to bear two types of the cost i.e.
Fixed Cost and Recurring Cost.

Expenses included in Fixed Cost are:

 ATM /Cash Dispenser

 UPS Battery

 Split AC

 Site Readiness

 CCTV

 Net Workings

Expenses included in Recurring Cost are:

 Annual Maintenance Cost

 Guard Salary

 Maintenance of ATM Room

  Electricity Cost

 Machine Part Replacement Cost

There are different criteria through which they earn their revenue for meeting up their expenses
made by the Bank for setting up the ATMs. Revenue comes from the rate per transactions charges
by bank for financial and non-financial transactions. I assumed per day 700 persons doing
transaction both financial and non-financial. Under which I got three cases, cases are in the
following manner :

Transaction Type Case 1 Case 2 Case 3

Financial 50% 30% 60%
Non-Financial 50% 70% 40%
Average 50% 50% 50%

In these three cases I had to do the viability check through Break Even Analysis and Net Present
Value Analysis.

During my research I came to know that financial and non-financial transactions can take place
with the same Bank’s ATM Card and with the others Bank’s ATM Card. During research I found
out the rate per financial and non-financial transactions i.e. Rs.19 and Rs.9 each. Further
bifurcation of charges charged by banks from customers can be:

 Percentage of transaction which goes to EMV (Euro Master Visa)

 National Financial Switch (RBI) Cost

 Settlement Cost

 Bank Switch Cost

 In the event of customer withdraws cash by using another bank’s card

i. Card Issuer Revenue

ii. Machine Acquire Revenue

 In the event of the customer withdraw cash by using acquire bank’s card

These all have some assumed parameters also such as :

1. 52% of charges for percentage of transactions which goes to EMV

2. INR/- 0.75 per transactions for National Financial Switch Cost

3. INR/- 0.80 per transaction for Settlement Cost

4. INR/- 0.94 per transaction for Bank Switch Cost

5. 30% of above all for the card issuer revenue for the transactions help by the another bank’s
card

6. 70% of above 4 points for the machine acquire revenue which is generated by the
transactions by another bank’s card.

7. 100% of the above 4 points for the transactions done by acquiring bank’s card only.

After researching and calculating all the values I had to analyse the calculation by calculating the
net cash flow. In my research I have to analyse on the base of the two cases :

Case A: In the event of customer withdraws cash by using another bank’s card

Case B: In the event of the customer withdraw cash by using acquire bank’s card.

In this we have Present Value through Present Value Interest Factor table discount rate @10% .

Here, Present Value refer to the present of a sum of money, in contrast to some future value it will
have when it has been invested at compound interest and The break even point is the production
level where total revenues equals total expenses. Total Profit at break even point is zero.

Analysis of Data

I my calculation I got all the different results for each case. But we have got the same result for the
Case B of each Cases in the analysis of Case B we do not get any profit due to which they are
unable to get any break even point. But for the sub Case A of each case we have different results
such as in Case 1 have Case A in which the bank get break even point after two years that means
after this bank will start earning profit. Similarly for Case 2 (A) in which bank gets break even
point after three years and for Case 3 (A) in which banks get break even point after two years. So
we can see that bank will start earning profit after two or three years.So that each bank has to take
some time for covering up their expenses by making revenues.
 KEY LEARNING

The 6-week summer internship exposed me to various aspects of working in a corporate

environment. I spent initial weeks learning about the organization, products offerings, channel of
distribution, key sales or provider of software’s to the different banks driver towards growth, etc.
I learn about the sales pattern in Northern Region of India , and how various aspects affecting
sales volumes are managed by the Origin team. I did state level and city level analysis which
provided me with a greater insight as to which Meerut city is that I selected in Uttar Pradesh. I
also did some day to day routine work which helped me to gain experience of working as an
employee of an organization. Also, my tenure here helped me various values and discipline that
needs to be followed moving ahead in the corporate world such as Listening to others, performing
under pressure, Time management, Multitasking. I gained much more exposure and knowledge
about working effectively and efficiently on MS-Excel which is a major and essential need of the
given corporate space.

Also, I learn during my internship period that data analytical jobs and tasks needs to be performed
keeping in mind multiple aspect and data analysis is a mufti-dimensional task. Further how to go
ahead with analysis of vast data requires the clarity of the outcome to be achieved has made me
understand forecasting skills needed.
 CONCLUSION

The aim of the study was to know about the expenditure and how to earn revenue per transaction.
The overview of the project report shows how Origin ACD IT Solutions Pvt. Ltd. manages the
setting up the ATM’s for the co-operative banks from starting the research for the banks and
suggesting them the areas where to set up their ATM’s and the more population area.

The major work over here comprised of major heads:

 Viability of Setting up Bank ATM’s
 Analysis with NPV or Break Even Point Analysis

In a nutshell I would like to extend my gratitude towards Origin ACD IT Solutions Pvt. Ltd., for
giving me the opportunity to work and learn in a competing environment. Further based on my
projects learning I would like to suggest that the expenditure should be driven more on the basis
on the credit period being offered and timely payment of dues, and group with timely revenues,
more transactions should be given more importance and handled with due care. Also, with
increasing industry growth there is still a lot of scope of innovation in terms of introduction of
new products, digital marketing on social media platform so as to gain advantage of the social era
and increase the market share, product presence, customer relations.

According to my observation in real world scenario, market diversification must be done in terms
of the places where products are sold, Origin ACD IT Solutions should look forward towards
Modern on trade outlets, or on social media so as to come forwards as more accessible to banks
and enhance the awareness towards its products.

Origin ACD IT Solutions Pvt. Ltd. is likely to grow as time progresses.