Automated Teller Machines of all public and private sector banks in the country will be brought under the National Financial Switch umbrella of the Reserve Bank of India by July, 2005.

The project, aimed at inter-connecting the ATMs of all banks, is being implemented by the Institute for Development and Research in Banking Technology.

Euronet Worldwide Inc, through its Indian arm, Euronet Services India Pvt Ltd, Euronet Worldwide is implementing the ATM connectivity project for IDRBT.

The project will enable customers to deposit or withdraw cash from an ATM of any other bank.

Launched officially on August 27, 2004, three banks - Corporation Bank, Bank of Baroda and ICICI Bank - have already joined NFS. Seven other banks are also likely to get hooked on to the NFS by January, 2005.

"While three banks already function under NFS, seven others are in the process of certification. We expect all the banks to come under the NFS network by June or July, 2005," IDRBT director V P Gulati told Business Standard.

The banks under the certification processes include IDBI Bank, Punjab National Bank, State Bank of India, United Western Bank and Karnataka Bank. The certification process includes ensuring that the ATM card type is compatible with the network.

Several banks have already entered into agreements with other banks, under which they can use each other's ATM networks.

Gulati said that NFS will complement the already existing agreements. "In fact, that makes matters easier, as banks which already have a tie up for ATM networks, will come under the NFS umbrella as a group," the IDRBT director said.

"The IDRBT is not concerned with the charges that banks will levy for using each other's ATM network. That will be left to the banks to decide. IDRBT is solely working on ensuring that money can be withdrawn from or deposited into any ATM of the country, irrespective of the bank in which a person has opened an account," Gulati said.

Loney Antony, managing director, Euronet Services India, said, "We expect all banks in India to come under umbrella of this Switch.

"But in Euronet we believe that the ATM penetration in India is still not satisfactory," Antony added.

According to the IDRBT, the NFS has assumed importance given the plans of the banks to share ATM resources. The project is expected to optimise costs for banks.

This project has economic advantages and offers wider reach while helping in preventing infrastructure duplication. Besides, when in place, this common solution opens up a range of electronic possibilities for banks, corporates and consumers.

Euronet Worldwide is an industry leader in processing secure electronic financial transactions.

The company offers outsourcing and consulting services, integrated EFT software, network gateways, and electronic prepaid top-up services to financial institutions, mobile operators and retailers.

Headquartered in Leawood, Kansas, USA, Euronet serves clients in more than 60 countries.

The IDRBT, established by the Reserve Bank of India in 1996, is an institute catering to the banking sector requirements in areas of education and training, security, technology, research and development and consultancy.

IDRBT runs the communication backbone of Indian banking sector, the INFINET (INdian FInancial NETwork).