The Telegraph
Since 1st March, 1999
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Five in alliance for all-time cash

Mumbai, Sept. 12: Sharing ATM networks is fast finding favour with banks. In a fourth such alliance in recent times, five nationalised banks, including Calcutta-based Uco Bank, have come together to launch CashOnline, a mega ATM network. The five banks that make up the group are Canara Bank, Central Bank of India, Indian Overseas Bank, Union Bank of India and Uco Bank.

The banks together have 10,720 branches, 100 million customers and 600 ATMs. The combined ATM strength will raised to 1500 by March 2004 and 2700 by March 2005.

The cost of an inter-bank cash withdrawal transaction (consumer of one bank using the ATM service of another) would be Rs 9, which is the lowest in the industry, chiefs of the five banks announced today.

Customers will be able to access the combined ATM network anywhere in the country, they added.

Canara Bank and Indian Overseas Bank have a strong presence in the south, while Central Bank of India and Union Bank of India have a large representation in the west and north. Uco Bank is predominant in the east.

The ATMs will be installed with a suitable mix of on-site and off-site locations. Individual bank’s switches will be interconnected through a central switch. All interbank transactions will be routed through the central switch. Canara Bank will act as settlement bank for inter-bank transactions.

Similar alliances in recent times include Mitr, CashTree and Cashnet. Mitr has been launched by a group comprising Punjab National Bank, Oriental Bank of Commerce, Indian Bank, UTI Bank and Global Trust Bank.

Bank of India, Union Bank of India, Indian Bank, United Bank of India and Syndicate Bank have teamed up to launch CashTree.

In May, Euronet Services India, a subsidiary of Euronet Worldwide Inc, which specialises in electronic payment solutions, launched an independent shared-ATM network in the country with IDBI Bank as the settlement bank. Apart from IDBI Bank, the other banks involved are Standard Chartered Bank, Citibank and UTI Bank.

Observers say that the large incidence of nationalised banks teaming up to share ATM networks reflects their pro-activeness in retaining and expanding their customer base vis-a-vis private and foreign banks that have a large ATM network.

In such a scenario, the trend of ATM sharing works out to the advantage of both the banks and consumers. The consumer gets the benefit of a much larger ATM network, services of which can be accessed at competitive rates. The bank, in turn, can offer superior service using a large network instead of wasting resources in creating its own infrastructure across the country.

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