What changed
RBI advised banks to explore engaging Cash-in-Transit (CIT) entities for banknote and coin distribution, in addition to Business Correspondents (BCs) as previously suggested. Banks are now advised to consider CIT firms for currency distribution.
What it means for you
Banks may consider leveraging CIT firms' logistics expertise to reach remote areas more efficiently, potentially reducing pressure on branch networks. This move aims to address last-mile connectivity issues and ensure adequate currency supply. Lenders should review their current distribution models and consider partnerships with CIT providers.
What you must do
- Evaluate existing currency distribution channels and identify gaps in last-mile coverage.
- Explore engagement with Cash-in-Transit (CIT) entities for banknote and coin distribution.
- Consider updating internal policies to include CIT firms as authorized distribution agents if engaged.
- Ensure compliance with RBI guidelines on currency management when onboarding CIT partners.
Who it affects
All Scheduled Commercial Banks including RRBs, Business Correspondents (BCs), Cash-in-Transit (CIT) entities, Bank customers in remote areas
What is the main change introduced by this circular?
RBI advises banks to explore using Cash-in-Transit (CIT) entities for distributing banknotes and coins, in addition to Business Correspondents, to improve last-mile connectivity.