Have commercial space? Invest in an ATM to generate income

Commercial real estate is typically a more lucrative investment than residential property because of the higher rate of return. Besides running your own business or renting the space to some other business, you can now consider another option—renting it out to a bank for setting up an automated teller machine or ATM. According to the RBI, there is need for more ATMs in the country and to address this issue of financial inclusion, the apex bank has allowed seven non-banking financial companies ( (NBFCs) to open white-label ATMs. 

An ATM owned and operated by an NBFC is called a white-label ATM. While a majority of white-label ATMs are to be set up in rural areas, a small percentage has to be installed in urban and semi-urban areas. For instance, Vakarangee is mandated to set up a minimum of 15,000 white-label ATMs in three years with a rural-to-urban ratio of 2:1. The Tata Communications Payment Solutions (TCPSL) will set up almost 5,000 of the mandated 15,000 ATMs in metros and urban markets.

When it comes to urban and semi-urban locations, there are basically two ways in which you can use your commercial space to earn additional income via the white-label ATM route. 

Rent out the space 

You can rent out your commercial space to a white-label ATM provider such as Prism Payment Solutions. Under its brand name, it deploys ATMs at locations with high footfall and good visibility across the country. Another option is to rent out a part of your commercial space while you continue to use it for your own business. Take BTI Payments Solutions' ATM-in-a shop concept. It allows for the ATM to be set up within the existing businesses premises, such as retail chains, shopping centres, businesses, standalone shops in urban locations, including Chennai, Hyderabad and Bengaluru. The rent you will get from the NBFCs will depend on factors like the city and the location of the ATM. 

Franchise ATM

Another way for leveraging your commercial space is by taking an ATM franchise. This model has been launched by TCPSL. "People can invest money in an ATM franchise and earn a return on their investment. If you have lobby space of 25 sq ft, or at least a 50 sq ft room, you can take the franchise of Indicash TATA  ATM. "The operation and repairs of Indicash are taken care of by us," says Sanjeev Patel, CEO, TCPSL. The company will also bear the electricity charges and install the required electronic security equipment. Of course, the locations with the highest footfall will be most preferred