LEAWOOD, Kan. - Euronet Worldwide, Inc. (Nasdaq:EEFT) has been selected by India's Institute for Development and Research in Banking Technology (IDRBT), the technology arm of Reserve Bank of India, to implement a national financial switch (NFS) in the country.
IDRBT selected Euronet to provide the two-part turnkey solution for the NFS, which will create a neutral platform that enables banks to connect their own switches to the NFS.
According to a news release, the NFS will contain both an integrated inter-ATM switch and an Internet and e-commerce payment gateway, which will act as an e-commerce facilitator to authenticate and route payment details between banks and various parties. This two-part solution is believed to be the first of its kind at a national infrastructure level.
The NFS will be a major step in building the financial infrastructure to allow connectivity for participating banks' ATMs. In many countries, national switches are developed and run by the country's central bank to ensure that all local banks can participate in electronic payments.
For the past two years, many Indian banks have established reciprocal ATM agreements. However, a national switch would facilitate interoperability among a far larger number of ATMs.
(See related story 3 Indian banks form country's biggest shared network yet)
"The NFS project will help prevent infrastructure duplication, facilitate optimal use of resources and raise the global competitiveness of the Indian financial sector," said Daniel R. Henry, Euronet Worldwide's president and COO. "The NFS multilateral network will ensure the widest acceptance of cards in the market and open up a range of electronic services for banks."
The installed base of ATMs in India is estimated to be more than 15,000 units and has been growing at a rate of more than 50 percent for the last three years. While new private banks have been the biggest deployers, more recently public sector banks and old private banks are implementing aggressive ATM installation plans.
Euronet operates a shared Indian ATM network called Cashnet, that includes nine member banks. These banks are connected with more than 3,000 ATMs serving more than 9 million cardholders across 250 cities in India. A number of Indian banks also have outsourced operation of their ATM programs to Euronet.
(See related stories Euronet in shared ATM network deal with 4 Indian banks, Euronet making India hub of Asia/Pac operations and More Indian banks outsourcing ATMs to Euronet)
"Euronet has extensive experience running shared networks around the world.In India, we are currently processing over 10,000 transactions per day under our Cashnet brand," said Loney Antony, Euronet Services India Pvt Ltd managing director. "Our mission is to bring financial payment solutions and convenience to the Indian consumer, and this NFS project is a cornerstone to fulfilling that mission."
