Indians For Guns

MUMBAI: A surge in currency van robberies is worrying the cash logistics industry, which may resort to drastic steps if authorities do not grant them the right to bear arms. The main issue is that, while banks can acquire guns for the guards employed by them, the agencies that manage cash cannot get a licence.

Industry officials say that incidents of looting of vans have increased from around one every three months in 2010 to almost thrice a month in 2013. At the same time, the number of armed guards is less than 50% of actual requirement. "Cash logistics companies transport Rs 15,000 crore of cash every day and hold on an average Rs 4,000 crore in their vaults on behalf of banks. We draw the cash directly from banks, yet we are not recognized by any of the authorities," said NSG Rao, secretary general of the Cash Logistics Association.

The association consists of seven founder members — the big boys of the cash logistics business. They are Brinks Arya, Securitrans India, AGS transact, CMS Securitas, ISS SDB Security, SIS Prosegur and SSMS. These companies together have close to 6,000 cash vans on the road.

But in recent years, there has been a mushrooming of companies which, the industry leaders fear, could dilute standards. "To run a taxi, one needs a permit. But at present, all that is needed (for cash logistics) are the vehicles and the ability to provide the lowest quote," said Rituraj Sinha, managing director of SIS Prosegur.

The association has been lobbying for its business to be classified as one which can officially be outsourced by banks. They hope this will enable them to position themselves as an adjunct to banking services and seek licence as an institution. Given that no response has been forthcoming, the industry is discussing drastic measures, such as a day's strike which would bring the issue into focus.

There are over 1.2 lakh ATMs across the country with around 3,000 added every month. Banks have outsourced installation and running of these machines, — which includes maintenance, security and cash loading — to management service providers (MSPs). The MSPs are specialized entities promoted by either ATM companies such as NCR, or technology or payment services companies such as Tata Communications or Prizm Payments.

The contract between MSPs and banks require that they provide two armed guards for every cash van — one to guard the van and the other to accompany the technician who stashes cash into the machines. Given the difficulty in getting armed guards, the MSPs have in turn outsourced the task to security companies.

To work around strict laws on weapon licences, these firms have been hiring security personnel who already hold licensed arms. However, police have started focusing on the role of these cash logistics companies after a recent spate of robberies. Authorities have taken the stand that arms issued for self defence to individuals cannot be used for providing security services.