Megalink to provide ATM services for small banks

Megalink to provide ATM services for small banks
By Doris Dumlao
Philippine Daily Inquirer
First Posted 21:32:00 04/03/2011

MANILA, Philippines—Automated teller machine consortium Megalink has launched a program to provide ATM services for small banks and cooperatives, sparing these niche players from investing heavily in expensive electronic banking platforms.

Using a similar business model adopted by independent ATM providers such as ENCASH, Megalink has agreed to deploy ATM terminals using the labels of small financial institutions. But these terminals will be operated and driven by Megalink.

Such a deal, anchored on a fee-sharing arrangement, was recently sealed with the 16-branch Cooperative Rural Bank of Bulacan (CRBB), Megalink president Benjamin Castillo said in an interview on Saturday.

“We tied up with [CRBB] as part of our advocacy for financial inclusion,” Castillo told the Inquirer.

“These are CRBB-branded ATM terminals located in CRBB branches. (But the ATMs are) operated and driven by Megalink,” he said.

With that arrangement, the small bank is spared from having to invest in technology, while it allows the institution to provide services to clients who want to use the ATM network in central and eastern Bulacan.

Apart from CRBB, MegaLink has also signed up a similar scheme with Maximum Microfinance Savings Bank, which will result in the deployment of Maxbank’s first ATM in Sabang, Puerto Galera, Oriental Mindoro.

Additional ATMs will be rolled out in Calapan in Oriental Mindoro, Batangas City and other strategic sites in Luzon.

Castillo estimated that these institutions would otherwise have to invest anywhere between P2 and P5 million to put up their own ATMs.

Aside from servicing rural banks, MegaLink claims to be the first network to accept nonbanks, and service “unbanked” areas. Its nonbank members include cooperative federations, such as MASS-SPECC and NATCCO, and electronic money issuer G-Cash, a subsidiary of Globe Telecom.

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