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9.22 In regards to switching cost, the Informant has submitted that Kotak Mahindra Bank, despite being a small-sized bank with about 961 ATMs as on March 2013 took nearly a year to successfully switch from BASE24 to Electra. Further, SBI could not successfully migrate from BASE24 to Opus successfully and thus is currently utilizing both switches. Even Punjab National Bank and Indian Bank scraped their RFPs after SBI's failure to migrate.

9.23 The Informant has submitted that ACI has provided a list of services provided by the NPCI such as the RuPay Scheme, Immediate Payment Service, Aadhar Enabled Payment System and Aadhar Payment Bridge System and argued that each of these services should be considered as independent transactions for the purpose of calculating the market share. The Informant has submitted that these services are not 'substitutes' of EFT Switches in any sense of the word. In addition, the Informant has submitted that IMPS transactions are inter-bank electronic instant mobile money transfer which is provided by the NPCI. It has been submitted that such transactions are processed through EFT Switch of the relevant bank itself.

The economic power of the enterprise including commercial advantages over competitors It was noted by the DG that ACI has the advantage of the first mover into the relevant market and that there are huge financial and technical constraints in migrating to other software as submitted by various ACI Banks.

The Commission, however, observes that at the point of sale of EFT Switch/ switch software there are enough competitive options such as Electra, Euronet or ACI, available to the customers of EFT Switch/ switch software. Once any of the suppliers' EFT Switch/ switch software is purchased and customized/ modified, the buyer would face some migration issues. Thus, such constraints are not peculiar to the BASE24 software and cannot by themselves be taken to give ACI a commercial advantage over its competitors. Further, it is evident from material on record that some banks have in fact changed their EFT Switch supplier.

Dependence of consumer on the enterprise With respect to the dependence of customers of EFT Switch/ switch software on the suppliers of EFT Switch/ switch software, the Commission observes that the DG, due to its erroneous understanding of the relevant market, has limited itself to the dependence of banks on EFT Switch/ switch software suppliers and has not considered the dependence of other buyers in the market such as ATM Network/ Interchanges on their supplier.

With respect to dependence of ACI Banks on ACI, the Commission observes that although ACI Banks have been using the BASE24 software for several years and have made huge investment in this regard and do face limited constraints in migrating to other software, migration to other switch software is possible and is happening in the industry. This indicates that the present case involves a product which once purchased and further customised would take some planning before migration to another product. The facts have also shown that switching and migration are happening in the industry through planned obsolescence.

In this regard, it is noted that as per the replies received by the DG from ACI Banks such as Royal Bank of Scotland, Oriental Bank of Commerce (OBC), HDFC and Kotak Mahindra have stated that there are no constraints in changing from one EFT Switch to another. It is important to note that Kotak Mahindra has successfully shifted from BASE24 to Electra, Further, OBC has recently empanelled alternate vendor for providing EFT Switch, and the process of migration from existing switch has already begun. Furthermore, Bank of Maharashtra successfully migrated to FIS switching solution from a hosted solution. In such a market, it may be appropriate to consider the inter-generational nature of competition that firms in the relevant market face not only from the other players coming out with alternate products, but also from constant upgrade demands from their current installed base of customers.