Central shared switch due to launch in July
Central shared switch due to launch in July
The central bank hopes to launch its central shared switch mechanism next month after a trial run that has already connected the account records of three of the Kingdom’s leading financial institutions, allowing them to operate ATM and point-of-sale (POS) terminals in tandem, according to a banking official.
Chea Serey, director-general of National Bank of Cambodia (NBC), said 13 financial institutions have signed up to be members of the initiative, which provides interoperability of the banking machines of different banks and microfinance deposit-taking institutions (MDIs) using a central switch maintained by the NBC. She said three banks are already testing the system and providing feedback.
“Currently, we are in the process of system integration and testing with a few members and it is expected that if the testing process goes smoothly, the system will be ready in July,” Serey said. “We [would like to] think that the few participants are pioneers as they are helping us to test our new system.”
First announced by the NBC in December, the central shared switch mechanism allows clients of the Kingdom’s financial institutions to use their bank cards with nominal fees at the ATMs and POS machines of any participating bank or MDI. By January 2018 all commercial banks and MDIs will be required to use the system for transactions that include balance inquiries, cash withdrawals and inter-bank fund transfers.
“The fee that will be charged will vary based on the type of the transaction conducted by the customers, and some transactions will be free of charge,” Serey explained. “We expect the fee to be relatively low because the NBC is already bearing the cost of system development, and it won’t be passed on to financial institutions and customers.”
While the NBC declined to provide the identity of the three institutions that have been participating in the testing phase, sources have confirmed to The Post that they include Acleda Bank, Sathapana Bank and Prasac Microfinance.
Currently, financial institutions and MDIs operate their own proprietary networks of ATMs and POS machines, which can prove costly as they expand to reach a larger customer base. The central shared switch mechanism is expected to reduce these costs by providing interoperability, allowing clients to access their accounts using the banking machines of other institutions.
Say Sony, vice president of Prasac, the Kingdom’s largest MDI by assets, said the central shared switch appears to be working well and that there is a high probability that it will be officially launched by all 13 members next month as scheduled.
“From Prasac’s side, it is working OK now,” he said, adding that the other two financial institutions have been conducting internal tests of the system to prepare for a wider launch.
“We are all committed to launch this project on time to provide benefits to clients and the financial sector,” he said.
