The RBI is preparing a pilot project on QR code-based Coin Vending Machine (QCVM) in collaboration with a few leading banks to improve distribution of coins among the public, said the central bank in its Statement on Developmental and Regulatory Policies.
The QCVM is a cashless coin dispensation machine, which will dispense coins against a debit to the customer’s bank account using Unified Payments Interface (UPI) and eliminate the need for physical tendering of banknotes and their authentication. Customers will also have the option to withdraw coins in required quantity and denominations in QCVMs, said the central bank.
“Coins we have a peculiar situation where the supply is very high, it’s taking up a lot of storage space and it’s not getting properly distributed, but at the same time there is demand in pockets. So, one way of increasing absorption of coins into the system is to make coins available in places where there is demand,” said Deputy Governor T Rabi Sankar.
Earlier, the RBI had strategically set up coin vending machines at marketplaces and busy locations to cater to the demand, but the problem was that the currency being fed into the machines was very often fake. This prompted the RBI to bypass the currency dependency and use the available UPI network.
“So, instead of feeding in currency and getting your change you just transfer money from your bank account to the concerned bank and withdraw your change. We took some time to develop that machine, we are trying it out in a pilot and we will expand it,” he said.
The pilot project will initially be rolled out at 19 locations in 12 cities, and will be installed at public places such as railway stations, shopping malls, and marketplaces to enhance ease and accessibility.
“The new QR-code-based pilot will facilitate coin acceptance via UPI facility on the go. This will contribute to the establishment of UPI as a cost-effective, simple-to-use, and preferred mode of payment for all at the last mile. It will also help to supplement merchant acceptance points, making the transition from cash to digital payments quick and easy,” said Anand Kumar Bajaj, Founder, MD and CEO, PayNearby.