The Hindu Business Line : New ATM-sharing network from Jan 1

WITH Swadhan, India's first shared payment network service that allowed member banks to share automated teller machines (ATMs), to be shut down on December 31, an alternative consortium has been formed.

Called BANCS (banks automated teller machine and customer services), the consortium will kick-start in January 2004.

Unlike Swadhan, which was run by the Indian Banks' Association, member banks would run BANCS, Mr Harish K. Murthi, Chairman and Managing Director, India Switch Company (P) Ltd (ISC), told newspersons here on Tuesday.

The member banks of BANCS include 14 from Swadhan and six of CashTree (network of five public sector banks - Bank of India, Union Bank of India, Indian Bank, United Bank of India and Syndicate Bank). The member banks would be able to access over 2,500 ATMs.

The banks' Visa debit and credit cards in turn can access over eight lakh machines worldwide.

The Reserve Bank of India has approved Bank of India as the settlement bank for the new project, with ISC as the service provider to route inter-bank transactions, he said.

Under BANCS, a user operating on another bank's ATM would be charged Rs 25 per transaction. Of this, Rs 5 would go to ISC while the credit or debit card-issuing bank would get rest.

In the Swadhan network, the user fee was Rs 55 per transaction, he said.

According to Mr Murthi, ISC is scouting for a strategic partner and was prepared to offload up to 24 per cent of equity on private placement. Efunds, EDS and the UK-based Link have approached ISC.

However, the company has not shown interest and there was no urgency for money at the moment, he said. Last year the company was valued at about Rs 100 crore by a top merchant banker, he added.

A few months ago, ISC received a $5 million sanction from First International Bank, US, through First Leasing Corporation of India, Chennai, for funding TRIMs (total retail infrastructure management services) project. ISC has also a term loan arrangement from State Bank of India, he said.

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