If you have commercial space, so invest in ATM to generate income

Invest in ATM to generate income

Investment in commercial real estate is more lucrative investment than investment in residential property because of much higher rate of return. Apart from doing a job, running your own business or renting the space to other business is good option but now you can also consider another option ie. Renting the commercial space to for setting up an Automated Teller Machine (ATM).

According to RBI, there is need for more ATMs in the country to address the issues of financial inclusion. Recently RBI has allowed seven NBFCs (non-banking financial companies) to open white-label ATMs. ATMS, which is owned and operated by an NBFC is known as; white-label ATM, while most of the white-label ATMs are to be set up in rural areas with a small percentage to be installed in urban and semi-urban areas. Vakarangee is about to manage and set-up a minimum of 15,000 white-label ATMs in next three years with the ration of rural-to-urban as 2:1. The TCPSL (Tata Communications Payment Solutions) will set up almost 5,000 of the mandated 15,000 ATMs in metros and urban markets. When it comes on semi-urban and urban locations, than there are basically two ways in which you can use your commercial to earn additional income via the white-label ATM route.

Rent out your commercial space for white-label ATMs:

If you have commercial space so you can rent out the same to white-label ATM provider, in which Prism Payment Solutions is one. Prism Payment Solutions deploys ATMs at most popular areas with good visibility across the country. Another investment option is to rent out a commercial space while you continue to use it for your own business. Payments Solutions is ATM-in-a shop concept, it set-up the ATM in existing businesses premises, such as; shopping centers, standalone shops, retail chains and businesses in urban locations such as; Hyderabad, Mumbai, Chennai, Bangalore and more. You will get the rent from NBFCs, which will depend on the factors such as; city and location of the ATMs.

How much investment it needs:

If you are offering the commercial space for the ATM, so you should know that it will be not installed in free. For whole process you need to shell out a security deposit of Rs 2 to 3 lakh or it can depand on the space, location and the number of ATMs you plan to install. As ATM is owned by the company, so you need to pay the security deposit, which can be equivalent to few months rent. The fixed monthly rent which you will get can range from Rs 25,000 to 30,000.

Franchise ATM:

If you own a lobby space of 20 sq ft or at least a room of 50 sq ft, so you can take the franchise of Indicash TATA ATM. TCPSL, take care the operations and repairs of Indicash, and company will also bear the electricity charges and install the required electronic security equipment.. As ATM franchise is another way to leverage the commercial space so TCPSL launched the this model with the collaboration of Franchise India. People can invest money in an ATM franchise and earn a return on their investment.

ROI:

A franchise will earn Rs 5 for nonfinancial transactions and Rs 15 for every cash withdrawal. The return on investment depends on location and return is calculated directly on the basis of the volume of transactions. Any ATM starts making money when it clocks 100 transactions per day.

Rent, Earnings and Franchise:

If you want to rent out your commercial space, so there is an opportunity to earn Rs 25,000 per month from the NBFC, which installs the teller machine. And if you have decide to take a franchise than there will be no rental income, but you will also bear the maintenance cost.

In franchise scheme, if, over a period of time your ATM sees 200 transactions a day, of which 40 are non-financial transactions and 160, are withdrawals, so you will earn a total of Rs 2,600. Even after deducting your costs, you could earn around Rs 53,000 (Rs 78,000—25,000) a month. Hence your income depends on the transactions that your ATM receives and it is the element of risk. So, it is recommended to weigh your options before deciding on the route that suits you.