State allows banks to hire private security agencies for cash vans

Hindustan Times

31-05-2025

Mumbai: The Maharashtra government has allowed public and private sector banks to engage private security agencies for securing cash vans used in the transportation of currency to banks and ATMs across the state. Alongside this, the state has issued a comprehensive set of guidelines and standard operating procedures (SOPs) to ensure smooth operations and prevent any untoward incidents.
Until now, banks primarily relied on police personnel and guards from the Maharashtra Security Force through the Maharashtra State Security Corporation (MSSC). In some instances, private agencies were also hired. However, this is the first time the state has introduced formal regulations governing private security agencies involved in cash transportation.
The new rules, titled 'Maharashtra Private Security Agencies (Private Security to Cash Transportation Activities) Rules, 2025', outline stringent requirements for private security operations. Each cash van must now be staffed with at least two armed guards and equipped with a GPS system monitored via a redundant communication protocol. The use of taxis or other hired vehicles for cash transport has been strictly prohibited.
To minimise risk, the cash limit per van has been capped at ₹5 crore. The van must conform to specifications detailed in the First Schedule of the Private Security Agencies (Regulation) Act and may be owned by the bank, the security agency, or the cash-handling firm.
According to the notification issued by the state home department on April 29, 'One armed guard shall sit in the front with the driver, and another in the rear portion of the van. During transit, loading or unloading, tea or lunch breaks, or restroom stops, at least one armed guard must remain with the vehicle at all times.'
Preference has been given to hiring ex-servicemen as guards. In their absence, eligible civilians may be appointed, subject to rigorous background checks. These include police and residence verification, employer reference checks, Aadhaar verification, credit history assessment, fidelity insurance, and mandatory training and certification.
As per government data, Maharashtra has licensed 7,684 private security agencies, of which 5,102 are currently active.
'The criticality of secure cash movement in daily banking operations, coupled with the growing number of ATMs and banking services, necessitated clear SOPs for private agencies handling cash transport,' said a senior home department official. 'The guidelines were framed in consultation with the Reserve Bank of India and the Director General of Police, Maharashtra. They are aligned with the Private Security Agencies Central Model Rules, 2020, issued by the Centre,' the official added.
The rules also prescribe specifications for private cash vaults used for storing currency overnight. For instance, premises for cash-handling operations must be located in secure areas—ideally close to bank withdrawal centres or police stations—while secluded or poorly connected areas should be avoided. Facilities must include separate areas for general office functions and secure cash processing. They should also accommodate cash collection, sorting, counting, and dispatch via secure vans.