MUMBAI, May 12: Even as the Shared Payment Network System (SPNS) of Automated Teller Machines (ATM) proposed by the Indian Banks Association (IBA) for its member banks remains a distant dream due to teething troubles, the network has appointed Bank of India (BoI) to work as the `ATM clearing cell' to clear the interbank transactions on consolidated basis every day to 40 odd stand-alone ATMs set up in Mumbai.

According to an IBA spokesman, already 25 ATMs have gone live on line, and around 120 ATMs are expected to be fully operational by the end of 1997. The initial plan was to complete the project by the early 1996.

As per the original plan, individual customers of different banks will be provided with common ATM cards with which they can do transactions with any member ATMs of different banks connected to the network. The `ATM clearing cell' will be similar to a normal cheque clearing cell where all the payments and claims made against individual banks are settled by the clearing house the same day in the evening.

According to a senior official of Bank of India, as per the assurance given by BOI to the network, it will provide clearing service at the rate of 50 transactions per day for 120 ATMs proposed in the network. For each of the 6000 transactions in Mumbai, BoI will get an undisclosed service charge.

According to sources, this will push up the cost of ATM transactions as each individual member of the network will have to pay 82 paise per transaction to the Indian Switch company - a joint venture of HMA Data Systems Pvt Ltd, Applied Communications Inc (ACI) and Tandem Computers which got the IBA contract to network the ATMs in return for a fee of Rs 1.4 crore.

As a number of banks are involved in ATM transactions using common ATM cards, there will be a number of interbranch and interbank debit and credit requirements as in the cheque clearance system. BOI will maintain a current account of all participating banks based on the information provided by member banks. Once the switch operator - Indian Switch company - gives all details about the transactions on a particular day, the clearing unit will make the debits and credits of card holders in the current account.

Currently ATMs installed in various banks offer three types of services - cash withdrawal and deposit and balance enquiries. While the last one is possible smoothly, cash depositing and withdrawal from the ATM network is creating logistic problems as the customers of different banks deal with ATMs of entirely different banks.

``If the customer of a particular bank deposits money with the ATM of a different bank, it cannot instantly acknowledge the receipt of money. The acknowledgement is possible only after one day of depositing the money because the receiving bank will have to inform the the customers bank about the receipt and the acknowledgement should come from the same bank - not the ATM of the bank which directly received the money. Therefore, customers prefer to deposit money in the ATMs of their own bank and are reluctant to deposit cash with the ATMs of other banks.

Already the project has been delayed due to problems of MTNL and DoT telecom lines, lack of uniterrupted power supply systems and confusion among banks about the operational details of network. Alarmed by the undue delay in project implementation, the IBA has set up a steering group/standing committee to monitor the progress of the network. The member banks are also hurriedly framing inter-branch and intra-bank electronic credit and debt rules, common ATM card issuing norms and various operating norms for the ATM card users.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.