City-based payment technology player Financial Software and Systems Private Limited (FSS) has asserted that its ongoing legal tussle with ACI Worldwide, a payment systems company headquartered in Naples, Florida, has nothing to do with bank ATMs (automated teller machines) running dry in the wake of the ban on 500 and 1,000 rupee notes announced on the night of November 8.
Nagaraj Mylandla, Managing Director of FSS, said the company has long since started using its own switch software to drive the ATMs. It is managing 40,000-odd ATMs out of a total of about 2,20,00 ATMs in the country.
Problem arouse when ACI, on November 11, ran a public notice announcing that it had terminated its agreement with FSS with effect from November 1 November 2016, and prohibited Indian banks from using its FSSNet platform, which offers payment processing services across all delivery channels, including ATMs.
FSS-ACI disputeThe ACI Worldwide notice said: “Since the breaches of the agreement were not cured by FSS, the agreement has been terminated with effect from September 1, 2016.”
The FSS-ACI relationship goes back to 1991, when FSS became a reseller of ACI's BASE24 software in India. In 1998, the FSS became a distributor and service provider for BASE24 software in India. Disputes between the two began in 2007-08. In June 2008, ACI proposed a new arrangement, terminating the distribution agreements with the FSS, assigning the licence agreements to ACI India, and demoting the FSS to the role of “provider of services in respect of BASE24 software to ACI Banks in India.”
The ACI public notice has created an impression that the FSS-ACI row is causing the problems at ATMs. “ACI’s notice to FSS has no legal basis and is primarily intended to cause confusion in the minds of banks and institutions that avail of the FSSNeT services,” he said. “This license continues to be active and valid from 2001 which ACI never disputed until recently; having failed to damage FSS business in their earlier attempts,” he said.
On 40,000 ATMs managed by FSSNeT, he said the company was using ADM (active device manager software) from FSS to monitor and manage the 40,000 ATMs and the cash to be loaded in these ATMs. This had no linkage to ACI BASE24 software that was under contention, he said.
Ihe main reason for shortage of cash at ATMs was the time taken to evacuate the old notes from all the 220,000+ ATMs and making them dispense only 100 rupee notes initially and then making the configuration changes at switch & ATM level to do 2,000 and 100 note.
“Now it is a question of sufficient 2,000 and 500 new notes to be provided by RBI.”
