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Bankom's ATM Services to Benefit Three More Banks
(East African (Kenya) Via Thomson Dialog NewsEdge)Bankom, a Ugandan independent ATM operator, says it expects to sign three more banks to its network by March 2006.
The inter bank switch links the automatic teller machine (ATM) services of participating institutions, allowing customers to transact business at any ATM on the Bankom network.
There are five financial institutions currently networked. They are Nile Bank, DFCU, Orient Bank, Cairo International Bank and Post Bank.
The switch now serves over 200,000 customers on its network of 45 ATMs, the second largest chain after Stanbic Bank, which has 66. Customers can also access their money through the 100 points of sale (PoS) facilities installed in shops, supermarkets and bars.
Michael Kaggwa, Bankom's managing director, said the service is free. The switch provider shares the cost with the participating banks.
But while more banks are joining the Bankom network, most of the big banks with a nationwide presence are yet to get on board. Some banks with a regional presence say they need to network with their regional branches first, while decision-making takes even longer with multinationals.
"At this point I can't say that we are joining the switch," said Joseph Walusimbi, head of corporate affairs at Barclays Bank. "We have our own ATMs, but we go according to business. If the market grows and our customers need more ATMs, then we might join Bankom.
He added that a lot of consult- ations and management decisions would have to be done before the bank joins the network. Barclays Bank has eight ATMs in Kampala and one at Entebbe Airport.
An official of Tropical Africa Bank, Edward Omoding, said that his bank was also considering getting on the switch once the management was through with consultations.
Although the idea of a common switch was conceived in 2003, it became fully operational in June 2005. Officials from Bank of Uganda (BoU), the switch regulator, said the service will get more popular if Bankom ensures that the product is reliable.
"The switch is not something that will catch on at once. Even in the United Kingdom, it took time for banks to accept the use of ATM services with a common switch," said Juma Walusimbi, the BoU spokesman.
The big financial institutions like Standard Chartered, Bank of Baroda and Barclays have their ATMs spread across the city, leaving their customers who travel to most upcountry towns without facilities to access cash.
"Our busiest ATMs are those from upcountry," said Bankom's operations manager, Pauline Mbayah.
The BoU is the regulator, clearing and settlement house for the switch services provider and the participating banks. It also licensed Bankom to facilitate electronic transfer of money from abroad using Visa Gateway services.
Bankom's services are currently available in Kampala, Entebbe, Mbarara, Jinja, Arua, Mukono, Masaka and Lira.
In Kenya, Pesa Point Kenya Ltd, an independent third party ATM operator, began its countrywide system rollout in November. The venture - estimated to be in the upwards of Ksh650 million ($8.6 million) - will see the installation of 120 Pesa Point ATMs by January.
Although the big banks have not shown interest in joining Pesa Point, a number of small banks have signed up to the network.
Banks such as NIC, Diamond Trust, Fina, Guardian, Stima Sacco and Imperial Bank have signed up.
A key benefit of the Pesa Point ATM network is that account holders of financial institutions that sign up as members can access their money at any one of the 120 Pesa Point branded ATMs countrywide. The system became operational mid last month and new ATM sites were commissioned in Nairobi, the Coast, Central and Western Kenya regions. More sites will be commissioned.
Pesa Point's network covers everywhere from remote areas to urban and peri-urban centres, making it easier and safer for card holders to access their money. It will also help reduce the ATM congestion in major cities at the end of the month, when consumers experience long queues and ATMs break down due to overload.
With 120 ATM's being deployed in its first phase, Pesa Point aims at being the largest ATM network in Kenya. It will also launch Visa card acquiring, which will mean both locals and overseas visitors will be able to use their Visa Cards to withdraw money all over Kenya.
In what might see more customers using Pesa Point ATMs, Barclays and Kenya Commercial Bank are replacing the ordinary debit cards with Visa cards
Distributed by AllAfrica Global Media. (allafrica.com)
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