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our state-owned banks launched on Monday their new integrated ATM network, which will help them reduce operating costs so as to increase efficiency and strengthen their presence in the regional market.

The ATM Himbara Link is a joint effort by state-owned lenders; Bank Mandiri, Bank Rakyat Indonesia (BRI), Bank Negara Indonesia (BNI) and Bank Tabungan Negara (BTN) incorporated in the State-Owned Banks Association (Himbara).

Himbara chairman Asmawi Syam, who is also BRI president director, said in his speech that according to the group'€™s calculations, Himbara Link would help state banks to save almost Rp 7 trillion (US$508 million) per year and Rp 30 trillion in the next five years in their routine maintenance costs for ATMs.

'€œInstead of investing in each of our own ATMs, the four of us need only invest in joint ATMs that can be used together. This will have a positive effect on our operating costs, including routine ATM maintenance,'€ he said during the launch.

BNI consumer banking director Anggoro Eko Cahyo said the lender spent about Rp 15 million a month in operating costs on each ATM and it usually added 2,000 new machines annually.

Asmawi said the new service would also benefit customers of the four state banks as tariffs charged for interbank transfers as well as cash withdrawals and balance inquiries would be cheaper.

He said, for instance, Himbara would reduce transaction fees by 50 percent, to Rp 4,000, when customers transferred money to accounts in other state banks.

Customers would also benefit from lower fees when they withdrew cash from the Himbara Link ATMs as fees would be cut by 90 percent to Rp 500, he added.

'€œOur calculations found that customers will see a reduction of Rp 7.3 trillion in transaction costs per year in total,'€ Asmawi said.

Artajasa Pembayaran Elektronis (ATM Bersama), a local interbank network provider, or '€œswitching company'€, has been appointed to provide the new system for Himbara Link as the four state banks will share machines instead of operating their own ATMs.

Artajasa has also partnered with its counterpart Sigma Cipta Caraka (ATM Link), a second-tier subsidiary of state telecommunications firm Telkom, which has been serving ATMs belonging to state-owned banks for some time.

For the first phase of the project, the four state banks have installed 50 Himbara Link ATMs in Greater Jakarta and expect that they will be able to install a total of 800 machines in the first quarter of next year.

The four state banks currently operate 55,804 ATMs nationwide, equal to 64 percent of the country'€™s total number of ATMs.

Gatot Trihargo, deputy for business services at the State-Owned Enterprises (SOE) Ministry, said previously that the ministry expected the four state banks to complete the full replacement of their current ATMs by Himbara Link by 2017.

The Financial Services Authority (OJK) has welcomed the new service, which, according to chairman Muliaman D. Hadad, will significantly affect efficiency levels in the domestic banking industry, as state banks contributed 40 percent of the country'€™s total banking assets.

'€œThis is an important step for state banks as they will have a bigger competitiveness advantage to anticipate global and regional competition, including the ASEAN Economic Community [AEC],'€ he said.

SOE Minister Rini Soemarno has praised the state banks'€™ new initiative as President Joko '€œJokowi'€ Widodo had requested all lenders to increase efficiency and synergize with each other to provide better services to customers.