All guesstimates
ModeratePhysical Estimation
Estimate the number of ATMs needed for a city of 2 million people
Scope it first — questions to ask
- · Are we estimating ATMs *needed* (demand-driven) or ATMs that *exist*? Scope: needed — size demand, then match machine capacity.
- · Indian city, post-UPI cash behaviour? Scope: yes — a typical Indian tier-2 city where digital payments have cut withdrawal frequency.
- · Include white-label and in-branch ATMs? Scope: all cash-dispensing machines, any operator.
Assumptions on the table
- · Adults ≈ 70% of population — India's age pyramid ballpark.
- · ~75% of adults are banked and still use cash regularly — bank account penetration is ~80%+ post-Jan Dhan, but some are UPI-only.
- · Post-UPI withdrawal frequency ≈ 2 per user per month — cash is now for the informal economy, not daily spend.
- · One ATM handles ~150 transactions/day — ~15 effective hours × ~10 transactions/hour (a withdrawal takes 2–3 min plus idle time).
- · Add ~25% machines above pure demand — geographic coverage, peak-hour queues, downtime, and cash-out buffers.
The worked solution
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