The four major banks are reviewing the future of their standalone proprietary ATM fleets after entering talks to establish a shared service network across Australia. Banking Day has been told by three banking industry sources that the major banks, Cuscal and Bank of Queensland are considering several options to pool their ATM services under a separately branded network. The strategic talks began in 2016 when ANZ, NAB, Cuscal and BoQ agreed to pool their fleets under a plan that would have outsourced the management of their combined system to a specialist ATM service provider. The four networks put their combined business out to tender early last year, which led to the shortlisting of four bidders for the contract: NCR, Cardtronics, Next and Telstra. However, the process was abandoned last September when Commonwealth Bank shocked the industry with its move to abolish charges on its ATM transactions. The CBA announcement effectively ruined the pricing assumptions embedded in the request documents issued by the three banks and Cuscal. But Banking Day has learned that all of the major banks are now involved in a fresh round of talks to merge their ATM fleets, with NAB, ANZ and Westpac most keen to strike a deal. While CBA is also participating in the discussions, it is not clear whether it has been persuaded to move to an industry-based "utility model" or persevere with its own proprietary network. The banks are expected to advance the ATM pooling option at the biennial meeting of the ATM Industry Association in Sydney on 12 September. Banking Day understands that the banks last met in March to progress proposals for arriving at a new deal. Most banks have a mutual economic interest to eliminate locational duplication of ATMs under the zero pricing policy they adopted last September. By outsourcing maintenance and management of a shared fleet, up to 5000 ATMS could be stripped from the 31,700 currently in operation across the country. This would reduce the cost burden worn by each bank for delivering automatic tellers at no cost to customers. Nevertheless, the banks are pursuing the merger option cautiously given the political backlash that is likely to follow an announcement to integrate their networks. The negative news-flow from the Hayne Royal Commission could defer implementation of the proposal until the middle of next year. Several banks have important technical motives for switching to a utility model. Banking Day understands that thousands of the bank-owned machines are not technically ready to accept the new $50 note that the Reserve Bank will put in circulation from 1 October. This is a major problem for NAB's network and Cuscal's Redi-Teller fleet, which each require new investment in hardware and software so their machines can accept the new note. Rather than invest in machines that are likely to be withdrawn from service in the near future, NAB and Cuscal might be content to have