Vortex, a manufacturer of solar-powered ATMs, is riding the growth wave on the back of rural expansion plans of various banks in the country
Chennai-based Vortex Engineering, a provider of Rural ATMs (Automated Teller Machines), announced India’s first large-scale rollout of Solar ATMs. The company won an order from State Bank of India for a deployment of 545 Gramateller Duo ATMs across semi-urban and rural India. Of these 545 ATMs, over 300 will be solar-powered.
According to V. Vijay Babu, chief executive, Vortex, such a large-scale deployment of solar-powered ATMs has happened for the first time across the globe.
A typical ATM, the one we are so accustomed to using in the cities, costs anywhere between Rs 5 lakh and Rs 6 lakh. A conventional ATM consumes about 1000 W of power and requires an air-conditioned environment—another 1500 W—for functioning. Thus, a conventional ATM consumes about 1800 units of power every month.
“It is a common misconception that solar power needs heat. What it needs is light, and even on a cloudy day, the light available is enough to charge the panels,” says V. Vijay Babu
In addition to that, due to frequent power cuts – sometimes for four to five hours, it needs a UPS and enough space to accommodate all these equipment. This takes the total cost of installing an ATM and keep it running to around Rs 8 lakh to Rs 10 lakh. To make this economically viable, the bank needs at least 250 to 300 transactions a day – a very high number for many parts of the country. Another problem banks face in the rural areas is finding enough crisp notes – a must for the ATM to dispense notes easily.
Realising the huge market potential in rural areas and the need to service them, banks approached IIT – Madras for a solution. IIT-M in turn turned to L. Kannan, founder and chief technology officer, Vortex Engineering in Chennai to develop a viable solution.
Vortex has been venture funded since 2004 to the tune of Rs 30 crore, at various stages of research.
After four years of research, from 2004-2008, Vortex rolled out its pilot ATM, which also has the distinction of being used for the pilot scheme for NREGS (National Rural Employment Guarantee Scheme). SBI also ran a pilot with 5 ATMs, one in IIT M and the rest in Cuddalore.
Says Vijay, “We found that the typical cash dispensing mechanism uses a conveyor-belt to pull cash from the bottom of the ATM to bring it up. This heats up the ATM, and requires too many electronic and mechanical components.”
To counter this, several options were experimented with. This included a table-top machine that would also be the cash box and would be connected to the desktop, where net banking would be possible. But, this was considered risky for security reasons, and other variations were worked on. The table-top model gave the idea for how the cash dispensing mechanism should work.
The ATM from Vortex has an indigenously developed a cash dispensing mechanism that is simpler and uses less mechanical and electronic components than the regular one.
It is designed like a box, to make it intuitive for those not from the urban areas. The ATM card swiper is designed for vertical swiping, to reduce the possibility of leaving the card behind. It can handle soiled notes. It consumes only 100 watts power and has a built in UPS so that the ATM does not need too much space for installation.
Given the fact that the transactions are low in rural areas, the ATM comes in two varieties – single denomination cassette and two-denominator cassette. The former, at Rs 1.35 lakh, is targeted at low transaction areas, and the latter, at Rs 2.75 lakh, in larger transaction areas. The latter has a more classy design since its usage is expected to be more in semi-urban areas.
The ATM comes with a biometric authenticator, as it is much more intuitive.
But, the innovation that will be considered revolutionary is that the ATM is solar-power enabled and solar panels are provided along with the ATM. In areas where power is a problem, this can be used with ease and back up can be charged for up to four hours.
“It is a common misconception that solar power needs heat. What it needs is light, and even on a cloudy day, the light available is enough to charge the panels. Only on very cloudy, dark days, charging may not happen. “In most parts of India, such a situation may happen only on 20 days at the most,” points out Vijay Babu.
The company is targeting 3000 ATMs for the year 2010-11, and 10,000 for 2011-12. It is already in the process of running pilots for large banks in the country. It has also exported nine ATMs to a bank in Dubai.
“We will continue to research. For instance, next could be to find out how to reduce power consumption to 20 Watts. Or how to upgrade as the transactions go up. The technology used is very complex, though it appears simple from outside,” points out Vijay Babu.
Not one to rest on laurels, continuous improvement is the goal for this company.