How would you like if your neighborhood mom-and-pop store could also double up as an ATM? A Bangalore-based payments processing company has made that its mission.

Ezetap, which can be thought of as a service similar to Square, has tied up with State Bank of India (SBI) and is trying to reach millions of mom-and-pop stores in the country with its new service—’Chota ATM’—aiming to bring ATMs to every neighborhood. Chota is Hindi for small.

The company manufactures card readers that can be connected to smartphones over wifi, 3G or a USB port. This essentially turns the phone into a point of sale (POS) device, allowing credit or debit card to be swiped. The company already has tie-ups with State Bank of India, Citibank in India and Equity Bank in Kenya for its mobile POS services.

In India, Ezetap sees a big opportunity in allowing cash withdrawals from the ubiquitous mom-and-pop stores, also known as kiranas. Chota ATM is the first time Ezetap is allowing cash withdrawals. There are an estimated 12 million kirana stores in India.

The device—the size of a palm—can be bought from Ezetap or from an SBI branch for Rs499 ($8) and a monthly fee of Rs150 ($2).

Here is how it works. A customer who wants to withdraw money can swipe a debit card on the Ezetap device. The shop owner gives the swiped amount to the customer. The transacted amount is reimbursed to the shop owner the next day, who also gets a cut of Rs5 ($0.08) per transaction. The Reserve Bank of India currently imposes a daily cap of Rs1,000 ($16) on such withdrawals.

Ezetap was founded in 2011 and was incubated by AngelPrime, a startup incubator, set up by Sanjay Swamy, Bala Parthasarathy and Shripati Acharya. It has raised three rounds of funding: $3.5 million by Peter Thiel, Chamath Palihapitiya, Nicolas Berggruen and David Sacks in 2012; $8 million in a round led by Helion Advisors and an undisclosed amount by American Express in 2014.

“It is costly setting up a bank branch or ATM but kirana stores are everywhere,” Abhijit Bose, CEO of Ezetap told Quartz. The company has already sold more than a thousand such devices and plans to sell 100,000 units over the next one year.

The combined reach of mom-and-pop stores and SBI opens a vast new market for Ezetap whose clientele so far comprised rapidly growing startups such as Myntra, an online retailer; OlaCabs, a cab service and RedBus, a bus-ticketing service, who used Ezetap’s devices to bill customers.

Kirana stores are typically present around every corner in India. Such is their sway that modern retail, operating under foreign investment restrictions, hasn’t challenged the habit-forming hold of the corner store even in India’s major cities.

SBI has more than 13,000 branches—more than any other bank in India.

And the timing of the launch might just be right too.

Using cards as a mode of payment is rapidly becoming popular among Indians. And most Indians are already comfortable using ATMs. The country already has 180, 494 of them.

The launch also ties in nicely with the ambitious Jan Dhan Yojana government scheme, which aims to open 75 million bank accounts by January 2015 for India’s vast unbanked population. Account holders will also get RuPay debit cards. That will be a lot of new card users, happy to withdraw money from their corner shop.