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ATM switches to be interlinked: State Bank order

KARACHI (August 16 2003) : In order to promote e-commerce and provide enhanced on-line banking facilities in the country, the State Bank of Pakistan has directed that the two major switches operated by banks be interconnected so that all the (automated teller machines) ATM card holders may access their accounts from any ATM location in the country.

At present there are two independent platforms operating in the country. One known as MNET is wholly owned and operated by MCB.

It is linked with 17 participating banks, while the other switch known as “1-Link” was launched by ABN Amro Bank NV and has nine other banking companies as co-owners.

While MNET at present has more banks as well as ATMs linked to its system, the other switch with four large network banks, namely, HBL, NBP, UBL and ABL, could have greater reach in the future if these banks invest in technology and ATMs.

SBP wants the two operators to ensure uninterrupted availability of service to cardholders at all facilities and touch points of the two switches. Since the lack of interconnectivity is hindering progress in creating a unified platform for on-line banking facility in the financial system, the central bank has directed the two operators to agree to work towards a hand-shake between the two systems so that settlement of financial and non-financial transaction messages could become possible and ATM card holders could access the balance in their accounts 24 hours/seven days and also meet their cash needs.

Both the operators would have to come to terms on the standards and guidelines for transactional security and integrity, establish a system for dispute resolution, and arrive at an agreement on inter-switch transaction fee and its split between issuer, acquirer switch and settling bank.

The Memorandum of Understanding (MoU) between two switch owners/operators has reportedly been inked, and the roadmap and milestones laid down to achieve interface between MNET and 1-Link.

The member banks on MCB owned MNET switch are: Citibank; Standard Chartered; American Express; Faysal Bank; Habib Bank AG Zurich; First Women Bank Ltd; HSBC; Credit Agricole Indosuez; Bolan Bank Ltd; Saudi Pak Bank Ltd; Bank of Punjab; KASB Bank; Bank of Khyber; Prime Commercial Bank; Metropolitan Bank Ltd; Mashreq Bank Pakistan Ltd; Deutsche Bank Ltd.

The owners of the 1-Link are: ABN Amro Bank N.V.; Allied Bank of Pakistan Limited; Askari Commercial Bank Limited; Bank Al-Falah Limited; Bank Al-Habib Limited; Habib Bank Limited; National Bank of Pakistan; PICIC Commercial Bank Limited; Soneri Bank Limited; United Bank Limited and Union Bank Limited.

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