The Hindu Business Line : Vortex wins order for 600 low-cost ATMs

Chennai, Oct. 26 The Chennai-based Vortex Engineering Pvt Ltd has bagged an order from a leading MNC automatic teller machines (ATM) network provider for the supply of 600 low-cost ATMs.

The CEO of the company, Mr V. Vijay Babu, told Business Line that the delivery of the first lot would commence early next week. The order would be completed in three years. Over the last one year five Vortex ATMs have been operating in Tamil Nadu and in Andhra Pradesh. Vortex received the order for regular installation based on the success of this pilot project, he said.

Vortex, a VC-funded company, is also in the final stages of talks with a couple of leading nationalised and cooperative banks. The company would manufacture about 50 machines during this fiscal. This would be in addition to the delivery schedule committed to the MNC Automatic Teller Machines network provider, he said.

The company has a capacity to make 100 machines a month.

Based on the business volumes it would outsource the manufacturing process as Votex will focus on research and development. The company set a target of offering ATMs for Rs 1 lakh and Vortex could reach the cost when the plant runs to optimal capacity, he said.

Vortex has developed the low-cost ATM with the objective of catering to the rural market. Machine cost was not the sole criteria but also installation and operational costs, he said.

The conventional ATMs cost around Rs 5 lakh besides the additional cost of Rs 8-10 lakh towards installation as they require about 3,000 watts power, air-condition and Uninterrupted Power Supply (UPS) back up. Vortex machines consume 100 watts and require relatively low power UPS. Besides they do not need air-conditioning and are suitable for rural areas where power is an issue.

As an austerity measure besides increasing customer service several banks have been working on reducing the transaction cost. The average cost per transaction through banks is Rs 42 while the same through ATMs is around Rs 20. In 2004 a few banks including ICICI approached IIT Madras to develop low-cost ATMs. Vortex came in to picture as it had developed low-cost micro-spinning machine that enabled villagers to convert cotton to yarn in their own backyard.

The challenge in developing low-cost ATM was to make Cash Dispensing Module (CDM) at minimum cost. The real cost benefit came out of its innovative method of using gravity to dispense cash instead of a conveyor that carries cash in the conventional machines, he said. Vortex is currently working on several enriching features in ATMs including cash acceptance and voice-enabled ATMs. The focus is on developing products for the banking industry, he said.

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