Citizens' Issues
Public Interest Exclusive
Fake currency notes from ATMs: What needs to be done

The issue of fake currency notes coming out of ATMs is very real. What can be done? Here are some suggestions

Most ATMs (Automatic Teller Machines) in India simply dispense cash, but increasingly are being readied for a host of other functions and capabilities, so the risk increases. According to the Reserve Bank of India (RBI) the ATM machines should:

  •  check the authenticity and fitness of notes, i.e. note processing machines/note sorting machines, and machines which check only the authenticity of notes, i.e. note authentication machines. All these machines shall classify the individual notes as either genuine or suspect.
  •  perform authenticity check with reference to the features of genuine notes as disclosed by the Reserve Bank of India from time to time. Any note which is not found to be having all the features of a genuine note shall be classified by the machine as suspect.

 Is this objective met? Not really.
There are two broad ways in which currency notes are stuffed into ATMs in India. One, by the bank staff themselves, usually for the 'onsite' machines. Two, by specific agencies which do the stuffing- often as common carriers for multiple banks. I have worked in many aspects of the ATM industry and my sources tell me:
1) None of the banks in India, currency chests or agencies have facilities for 100% verification at all stages of currency notes headed for ATMs-except for some very specific marked ATMs which are located in VVIP locations. Yes, this is being corrected, but the speed of growth of ATMs is also high.
2) The chances of genuine cash sent by the banks directly from the cash chest/teller being swapped for counterfeit notes is not so high for onsite ATMs. However, it does exist as a higher risk for off-site ATMs, as well as for ATMs stuffed by agencies. The arrival of 'white' ATMs will further muddy the waters.
3) The global concept and practice of sending only pre-stuffed and sealed 'cassettes' for insertion into the larger 'cartridges' for the dispensers and then to be placed inside the 'vault' of ATMs is being resisted by banks and agencies in India. These pre-sealed 'cassettes' provide physical security by 'neutralising' currency notes in case of physical attacks and also provide note-by-note accountability in case of transactional lacunae.
What would we, as consumers of currency notes, really want and deserve? After all, the issue of FICN/counterfeit currency notes is very real, and at the very least, some steps have to be taken to protect us, assuming that almost all ATM transactions are for consumers who not in the fake money business. Here are some simple steps which need to be taken, and which we should demand:
1) All ATMs in India need to be provided with a centralised RBI reference number, and this must be displayed prominently at the location, as well as on the ATM and also on the paper trail.
2) All ATMs must indicate whether they are "sealed cassette stuffed" or "loose stuffed".
3) Performance of ATMs-failed transactions, disputed transactions, down-times, frequency of FICN and similar data must be available online.
4) ATMs can then be provided either 'star' rating or percentile performance rating, which needs to also be displayed on the ATM.
5) Most importantly, the ATM must indicate whether it is providing 100% authentic currency notes or not, and by what method.
6) Certain other safeguards, like silent alarm provision as well as provision of a 'cover' on the key-pad, need to be incorporated too.
7) Disabled access is another issue which needs to be resolved.
There are more too, but these are the least we can expect. After all, we are customers worth Rs4 lakh a day-a fairly heavy turnover under any circumstances for 9 square metres of real estate.
A bank is not doing a customer a big favour by providing an ATM; it is actually doing itself a favour primarily by reducing the cost and effort of human interaction. In exchange, a customer must know what level of service to expect, and RBI needs to enforce this. Today's customer is very aware of what is going on and is willing to pay a premium for better and more reliable service. The earlier this is done, and certainly before the introduction of "white ATMs", the better.

(Veeresh Malik had a long career in the Merchant Navy, which he left in 1983. He has qualifications in ship-broking and chartering, loves to travel, and has been in print and electronic media for over two decades. After starting and selling a couple of companies, is now back to his first love-writing.)



Shahid Shaikh

3 years ago

I received two fake thousand rupees notes from SBI ATM and one fake thousand rupees note from ICICI bank ATM. My question is what to be done in this case as the banks will never accept that notes has been dispensed from their ATMs. How to solve such issue. Pls advise.


Veeresh Malik

In Reply to Shahid Shaikh 3 years ago

Please file a written complaint online with the Reserve Bank of India giving them full details and hope for the best after that. I fear that is all you can do at this juncture. Good luck.

Sai chandra M

5 years ago

I feel there should be some mechanism like while loading cash into the atm the machine will read all the notes serial number.

when ever a person with draws cash from the atm he should get the the serial numbers on the receipt, so that a person can demand for the justice against the respective bank if he get's the fake note.

-sai chandra


Veeresh Malik

In Reply to Sai chandra M 5 years ago

Thank you for writing in.

Here's an RTI application filed in this context, shall add the respond as soon as I receive it.


hari prasad b

5 years ago

thank u sir giving good knowlege about fake note. harded money is safe by using cheques, netbanking & card transfers via atm. drawing small denomination is best. less chances to fake notes.

Kranthi Kumar

5 years ago

Hi Veeresh Malik,
Your article is very informative. But I request you to include "What a customer should do, When he gets a fake currency note at an ATM machine". Should he loose his hard earned money? What are the steps required to be taken by a customer?

Very recently, I had started opinions on the same topic on a popular educational forum, But didn't get any helpful response. Here is the link for that.

a v moorthi besides TIHAR

5 years ago

from 10.11.2004 RBI advised all banks to file FIR with Police irrespective of the number of pieces/ bonafides of tenderer.

When position as above Banker and the common citizen, usually adopt the policy of burning of that counterfeit note on

detection ( when it is say one out of hundred or more) as detection and impounding counterfeit notes in the legal way is a

troublesome aspect which is beyond tolerance for both the public and bank staff.This solution may not be in accordance with

the law of the land but years experience gained in India ( law is an ass) says it is a good solution.

Nowadays Banks have out sourced refilling of cash in ATMs. Usually the 2 cash trays can hold about Rs 14 lakhs if one tray

each is filled with Rs 100/- and 500/- denomination. Now it takes about 10-15 minutes to refill in one ATM. The out sourcing

agency will try to fill about 20-25 ATMs in a day (10 AM to 7 PM) spread over 60-80 Kms in distance. So the agency man

withdraws cash to the tune of Rs Rs 3 crores. Now there is Bank staff, agency staff if any one of them is of doubtful

integrity 8 to 10 pieces of notes can be removed from the lot or 8-10 pieces of counterfeit notes can be inserted ( because

it is humanly impossible for the agency man to verify each piece of note and count the physical cash. if the above happens

cash shortage in ATMs can happen ( only joint custodian is responsible for cash - here the agency person) when this happens

this comes out when the ATM runs out of cash which can happen the same day or definitely when ATM has to be refilled by cash.

I have still not able to find a so;ution for the above in the existing scenario. In the case of counterfeit as the 8-10 notes

are distributed over 20-25 ATMs it is next to impossible to track the mischief maker and if ever a counterfeit is reported if

the Branch head of the Bank feels the customer is genuine either they destroy or put the counterfeit back in circulation

without impounding as hardly one such case will come in a year.

recently other day a young girl who enjoys doing net banking and using card based transactions was seen shouting at the

branch Manager of a PSB which recently completed 100 years for his un caring attitude despite of the fact that she had

withdrwan cash of Rs 50000/- a few minutes back and and the when she deposited the same in next door branch of India's No 1

Pvt sector Bank, the cashier there has impounded one note.when the young lady came out of the PSB i talked out to her told

her the examples detailed above but as the impounding bank has issued her a certificate to the effect my prayer was she

should not get call from investigating agencies in next 3 months( as that is way law operates) and meanwhile can scan the

receipt and share it with her friends as a momento.

As of now, there is nothing much you and I can do if we get a fake currency note from an ATM.

The media should take up for implementation of "The global concept and practice of sending only pre-stuffed and sealed

'cassettes' for insertion into the larger 'cartridges' for the dispensers and then to be placed inside the 'vault' of ATMs is

being resisted by banks and agencies in India".

another issue needs to be follwed by Money life is

Staff Selection Commission receives on line application but fee can be remitted by one thro Net Banking facility of SBI only

. As approval of the Controller General of Accounts, Ministry of Finance is awaited for use of credit cards / debit cards

since January,2010, payment through these modes will not be available.This is the position even for Combined Graduate Level

Examination -2012 whose closing date for application on line was 20.04.2012

R Nandy

5 years ago

You have pointed to a very important issue.

I was just wondering if it is technically possible for the ATM machine itself to validate the notes and dispense it to the customer?Probably a small
hardware/software upgrade of the existing machines?

a v moorthi besides TIHAR

5 years ago

RBI has got detailed guidelines regarding detecting and impounding counterfeit notes.

Forged Notes Detected at bank branch

Impound Forged note: Size: 5 x 5 cm seal
Issue Receipt (in duplicate) taking the acknowledgement of the tenderer even if he not willing to take it. (Notice to be displayed)

Forged Notes Detected at bank branch

File FIR with local police – endorse a copy to Forged Note Vigilance Cell and/or to Head Office of the bank, with all the details: how the notes came into possession of the tenderer etc.
The data on forged notes is required to be sent, in a monthly return to RBI and National Crime records Bureau.
In no case forged notes should be returned to tenderers or destroyed by the bank branches.
Security features of all the Bank Notes are required to be displayed at the branches.
W.e.f. from 10.11.2004 RBI advised all banks to file FIR with Police irrespective of the number of pieces/ bonafides of tenderer.



In Reply to a v moorthi besides TIHAR 5 years ago

Moorthy ji, thank you for writing in.

And here are some more articles on the same subject:-



Narendra Doshi

5 years ago

Dear malq,
Pl clarify what you mean by 'white' ATMs?
Your points are well worth for a price , too. I hope the authorities take corrective steps , sooner than later.



In Reply to Narendra Doshi 5 years ago

Dear Narendra Doshi ji, thank you for writing in.

A "white" ATM is put up and operated by a non-banking entity.

Some details can be found here in the relevant RBI circular enclosed.



5 years ago

Whom should we complain in case we get a fake note from the ATM machine. Is there a toll free number to contact. What can we the proof that the note the customer is pointing out as fake did come out of the ATM only? Please advise.



In Reply to Veeraf 5 years ago

Dear Veeraf, thank you for writing in.

As of now, there is nothing much you and I can do if we get a fake currency note from an ATM, other than throw it away.

However, you can bring it to the attention of the relevant bank which operates the ATM, and hope for the best.

I am sorry I could not be of more help.



In Reply to malq 5 years ago

Thanks Malq for your response. Now atleast the readers know that there is no safe gaurd and they need to protest against it ASAP, otherwise we all can be a victim one day.


In Reply to Veeraf 5 years ago

Dear Veeraf - thank you for writing in.

I have forwarded this issue to the RBI as well as the Home Ministry and the Finance Ministry more than a few times, but it never seems to make a difference, some days I feel that one reason could be because there are existing schools of thought which do not want to solve the issue.

Anyways, we persist - and with the average turn-out from an ATM being about 4 lakhs a day, for about 1.02 lakh ATMs in India and growing, something needs be done. And soon.

I request all readers to forward this article to RBI and the Ministries of Finance as well as Home Affairs, and to their friends - let us get some correctives in place?



5 years ago

Great read. shared the article at our blog.



In Reply to mansi 5 years ago

If this is the threat, should these suggestions not be demanded through a PIL to be filed in Court. Maybe float an online petition and file it.


In Reply to mansi 5 years ago

Thank you, please let us have the link? And here are some more articles on the same subject:-


Atom technologies partners with Reliance Securities, Visa for online debit card payments

Under the agreement atom technologies would facilitate online payments to about 10 lakh customers of Reliance Securities using Visa Debit card

Financial Technologies Ltd-promoted atom technologies has partnered with Visa and Reliance Securities to offer online money transfers for broking accounts using Visa debit card.

Dewang Neralla, director and chief executive of atom technologies, said, "This is another path-breaking innovation in payments. I am sure acceptance of Debit cards will enable brokers to tap India's vast Debit card subscriber base and investors from the recesses of India for partaking in financial market activities, thus paving way for financial inclusion."

This service is the first-of-its kind in India as customers can now just log on to the website of Reliance Securities and click on the 'pay through Visa Debit card option' to make online payments to their broking account. This service requires the trader to register his Visa Debit card once on the Reliance Securities website, enabling him to make secure payments using his Visa Debit card in real time, atom technologies said in a release.

"Indian consumers value and have come to expect a versatile and universal method for making and receiving payments through their cards. From today millions of investors can pay for their stock and commodity investments with the same convenience, security and reliability that they experience when they use Visa anywhere else," said Uttam Nayak, group country manager for India and South Asia at Visa.


Public Interest Exclusive
459 Public Information Officers in Maharashtra penalised Rs45 lakh in 2011

RTI applications have jumped by a lakh in Maharashtra compared to 2010 with the urban development department receiving the highest number of applications, according to the 6th annual report of Maharashtra State Information Commission

The sixth annual report of the Maharashtra State Information Commission, portraying the scenario of the Right to Information (RTI) activities in Maharashtra is out and Moneylife has procured a copy of the same. The picture is indeed hunk- dory in this 111 page report as against the ground reality where the RTI movement in Maharashtra has suffered immensely due to state government’s neglect in appointing the full quorum of information commissioners and reluctance to provide full-fledged staff to the information commissions for the smooth and efficient disposal of second appeals.

That the citizens of Maharashtra continue to be enthusiastic about using RTI is expressed through the 6,45,023 RTI applications which were filed in 2011 alone. Out of these, 6,07,057 were disposed off. There has been an increase in filing RTI applications by nearly 1 lakh as compared to 2010 when 5,48,987 application were filed. Ever since the implementation of the RTI Act in 2005, Maharashtra has seen a six-fold increase in RTI applications. In 2006 the RTI applications number 1,23,000.

Clearly, the issue of unbridled and “illegal” development in terms of urban constructions weighs heavily on peoples’ minds. This has been reflected in the highest number of RTI applications having been received by the urban development department in 2011— a whopping 1,89,01 lakh applications. This is followed by the revenue department (land scams, land title records, etc that affect thousands of people) which received 92,009 applications. This is followed by the home department: 58,655 RTI applications; rural development: 49,647 and law and judiciary: 42,850. Other departments which received applications between 18,000 and 28,000 are home department; building department; co-operative, marketing and textile department; industrial, energy and labour department and; school education and sports department.

It was a dismal state of affairs with several posts of information commissioners having remained vacant (still vacant) and additional responsibility given to the existing ones. The annual report notes that despite this paucity, 16,211 decisions were given out of the 22,339 second appeals all the state information commissions put together. The report adds: “In 2010, the number of second appeals was 17,266 and despite there being a dearth of information commissioners, it is satisfying to note that decisions were made on 16,211 second appeals.” The state chief information commission’s office in the Mantralaya received 5,653 complaints out of which 4,436 complaints were solved.

Vijay Kumbhar, a leading RTI activist, counters the hunk- dory picture painted by the state information commission in the annual report. He says that, “penalty has been imposed on 459 PIOs (public information officers) but what action has the information commission done to ensure the recovery of the nearly Rs45 lakh penalty? What about the second appeals that have not been disposed off? Maharashtra, which is on the brink of collapse as far as RTI is concerned, is not reflected in the annual report.”

Table 1
No of RTI applications filed over the last six years

2006 – 1,23,000
2007 – 3,16,00
2008 – 4,16,090
2009 – 4,40,728
2010 – 5,48,987
2011 – 6,45,023
Total – 24,89,828

Table 2:
Major departments which received RTI applications:

Urban development: 1,89,017
Revenue and forest: 92,009
Home:                          58,655
Rural and irrigation: 49,647
Law and judiciary:     42,850
Housing development: 25,686
General building: 22,830
Co-operative, marketing and textile: 18,968
Industrial, energy and labour: 18,727
School education and sports: 18,462

Table 3:
Not happy with first appeal and therefore filed second appeal:

Pending from previous years: 12,866
Second appeals of 2011: 22,339
Total complaints: 35,205
Disposed off in 2011: 16,211

Unhappy with the PIO and therefore filed second appeal:
Pending from previous years: 2671
Second appeals of 2011: 5656
Total complaints: 8326
Disposed off in 2011: 4436

Penalty imposed on PIOs at State Information commissions

No of PIOs penalised: 459
Amount of penalty imposed: Rs44,42, 750

(Vinita Deshmukh is the editor of Life 365 ( She is also the consulting editor of Moneylife, an RTI activist and convener of the Pune Metro Jagruti Abhiyaan. She is the recipient of prestigious awards like the Statesman Award for Rural Reporting which she won twice in 1998 and 2005 and the Chameli Devi Jain award for outstanding media person for her investigation series on Dow Chemicals. She co-authored the book “To The Last Bullet - The Inspiring Story of A Braveheart - Ashok Kamte” with Vinita Kamte. She can be reached at [email protected])




5 years ago

What about CBDT and its field offices? Or, the MCD or the Delhi Admn., the DDA or the Police all over the country or the West Bengal govt. as a whole? The bureaucrats in India are hardly bothered about RTI and the top bosses couldn't care less. RTI is indeed a non starter.

Anupam Saraph

5 years ago

This is a poor reflection of governance and transparency.

The fact that 6.5 lakh requests for information under RTI in 2011 reflects complete absence of RIGHT to information where information should be available automatically.

Only 3.5% filed an appeal. If the system does accede to the request for information under RTI it is surprising that a whopping 25% went in for a second appeal. It is shocking that ONLY in 10% cases the PIO's were penalized for refusing information.

Interestingly there is no statistic about appeals disposed WITHOUT hearing. This has been large in the case of Pune. It would be well to audit the performance of the machinery to deliver the RIGHT to information and provide natural justice.

There is no statistic on information requested about public issues (which should become part of the governments web site once it is realized that this information is requested by the people) and information requested about individual transactions with the government (which should automatically be provided to each individual in their transaction of similar nature in the future).

The report clearly has no desire to deliver the RIGHT to information but simply aims to propagate the myth of delivering RTI.

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