Estimation - Number of ATMs in India
Estimation - Number of ATMs in India
Product Management Interview: Guess estimate the total number of ATMs in India
Known: The population of India - 1.3 Billion
Assumption - Let the Rural : Urban split be 70 : 30 % of the total population.
Population Split -
Therefore, the population split approximately comes to,
Rural = 900 Million
Urban = 400 Million
Household Split -
Next, we will calculate the number of Households in India,
Assuming, there are 4 people in a household for both urban and rural,
(Ideally, we would assume, 3 for Urban and 5 for Rural)
Household split come to,
Rural = (900 Million / 4) = 230 Million
Urban = (400 Million / 4) = 100 Million
Total number of ATM cardholders in India -
Next, let’s estimate the total number of ATM cardholders in India,
Assuming,
70% of Rural household has ATM cards and,
90% of Urban Households has ATM cards
This comes down to, (70% of 230 Million)
= 160 Million ATM cards in Rural and (90% of 100 Million)
= 90 Million ATM cards in Urban.
Now, let’s assume -
In Urban, let say 10% of household has 2 ATMs and rest of the 90% has 1 ATM,
= (10% * 90M)*2 + (90% * 90M)*1= 18 + 81 M = ~ 100M ATM users
In Rural, let say 100% of household has 1 ATMs,
= (100% * 160M)*1 = 160 M ATM users
Now Assuming,
1 ATM is mapped to ~500 users in the Urban area, & ~2000 users in Rural area
Total number of ATMs in Urban + Rural India =
= 100M/500 + 160M/2000
= 2,00,000 + 80,000
= 2,80,000 ATMs are there in India.
The actual number of ATMs in India is around ~2,40,000
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There is an error in the line "In Rural, let say 10% of household has 1 ATMs", instead of 10% it should say 100%.