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Interbank Networks in India
An interbank network, also known as an ATM consortium or
ATM network, is a network that connects the ATMs of different banks and
permits these ATMs to interact with the ATM cards of other banks within a
given network.
Interbank ATM network is a network of ATMs wherein a
cardholder of any of the participating bank can carry out specified
transaction at any of the ATMs connected to the network. In the coming
years, the cost of investments on ATM terminals will be on the rise, and at
the same time, transaction volumes per ATM will fall with an increasing
numbers of ATMs. Thus the best option for banks today, is to share the
service and infrastructure for a small fee.
In 1997 an attempt was made in
this direction with Indian Banks’ Association’s (IBA) Swadhan network.
While interbank networks provide capabilities for all
ATM cards within the same network to use other banks' ATMs that belong to
the same network, the services vary. Usually, when a person uses their ATM
card at an ATM that does not belong to their bank, the basic services, such
as balance inquiries and withdrawals, are usually available. However,
special services, such as the top-up of mobile phone talk time, are usually
not accessible to ATM cardholders of banks other than the ATM cardholders of
the acquirer (the bank that owns the ATM). Furthermore, most banks will
charge a fee to users of cards that do not come from their own bank.
Currently, there are five major interbank ATM networks operating in India &
National Financial Switch, BANCS, Cashtree, Cashnet and Mitr.
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