֍National Financial Switch (NFS) is the largest network of shared automated teller machines (ATMs) in India.
֍It was designed, developed and deployed by the Institute for Development and Research in Banking Technology (IDRBT) , with the goal of inter-connecting the ATMs in the country and facilitating convenience banking. It is run by the National Payments Corporation of India (NPCI).
֍The National Financial Switch was launched by the IDRBT on 27 August 2004, connecting the ATMs of three banks, Corporation Bank, Bank of Baroda and ICICI Bank.The IDRBT then worked towards bringing all major banks in India on board.
֍The first ATM in India was set up in 1987 by HSBC in Mumbai. In the following ten years, about 1500 ATMs were set up in India.
֍In 1997, the Indian Banks’ Association (IBA) set up Swadhan, the first network of shared ATMs in India. It was managed by India Switch Company (ISC) for five years, and allowed cardholders to withdraw cash from any ATM in the network, for a fee if they did not have an account with the bank that owned the ATM. But Swadhan collapsed.
֍After the collapse of Swadhan, Bank of India, Union Bank of India, Indian Bank, United Bank of India and Syndicate Bank formed an ATM-sharing network called CashTree. Citibank, the Industrial Development Bank of India, Standard Chartered Bank and Axis Bank formed a similar network called Cashnet.
֍In August 2003, the IDRBT announced that it would be creating the National Financial Switch (NFS) to link together the country’s ATMs in a single network.
֍Institute for Development and Research in Banking Technology (IDRBT) handed over the National Financial Switch to the National Payments Corporation of India (NPCI) on 14 December 2009.
֍Any bank that provides core banking services with 24×7 transaction banking capabilities with or without ATMs may join the National Financial Switch through a sponsor bank. This allows non-scheduled Urban Co-operative Banks (UCBs) and Regional Rural Banks (RRBs) to gain access to the national network of over 103,000 ATMs in the country.
PRACTICE QUESTIONS
QUES . Which one of the following links all the ATMs in India: UPSC 2018
(a) Indian Banks’ Association
(b) National Securities Depository Limited
(c) National Payments Corporation of India
(d) Reserve Bank of India
Answer (c)
