Over the past decade consolidation in banking has created something of a two-tier industry, with enormous institutions at one end and a robust segment of smaller ones at the other. As consolidation now sweeps the world of electronic funds transfer networks, the question is whether a similar topography will emerge in that arena.

Can small ATM networks find a place in a field where the benefits of being small are harder to define? The issue was brought to the fore when Shazam, a small and defiant network in Johnston, Iowa, began sounding alarms about the evolving situation. Executives of Shazam say the growing dominance of large networks - Star Systems Inc., MAC, and NYCE Corp. - may lock small banks out of the point of sale debit card business and other new payment methods such as digital certificates, check conversion, and Internet debit transactions.

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