International Finance Corporation (IFC), a member of the World Bank Group, is investing $2.7 million as equity in Vortex Engineering. The company, which was started by entrepreneurs and IIT alumni, has developed low power-consuming ATMs tailor-made for semi-urban and rural areas.
The proposed investment will help the company expand its network of automated teller machines across India’s rural and semi-urban areas where people have limited or no banking services.
Widespread installation of low-cost, easy-to-use ATMs in rural areas will facilitate cash withdrawal, especially for the zero-balance, no-frills account holders, helping them access banking services that are otherwise proving difficult because of high cost. Vortex’s innovative, solar-powered ATMs combine ease of use with rugged design, said in the company's statement.
“IFC’s assistance in implementing technology-led banking services would eventually help us take our offerings to other developing countries,” said Vijay Babu, CEO of Vortex Engineering.
The ATM market in India is expected to grow three-fold over the next three years, with the bulk of machines bound for remote areas. In addition, banks are increasingly focusing on reducing costs by setting up ATMs instead of full-service branches.
“The investment will help in taking basic banking and financial inclusion schemes to rural and semi-urban areas in India,” said Thomas Davenport, IFC Director for South Asia. “Bringing banking close to home means a lot in a country where less than one-fifth of over 600,000 villages have a banking touch-point.”
Vortex focus is developing low-cost ATMs especially designed for rural markets. Its machines have low capital and operational costs and consume significantly less power than conventional machines. Vortex’s machines accept soiled notes, unlike other ATMs that can operate only with fresh notes, and also can authenticate customers through fingerprints. The use of solar power also helps in rural markets lacking access to electricity supply, said in the company statement.
