A deal agreed last year between ICICI
and First Data has now received Reserve Bank of India approval,
paving the way for a merchant-acquiring alliance widely expected to
accelerate card growth. The new firm will look to more than treble
its Indian POS network in the next five years, reports Douglas Blakey.

ICICI Bank, India’s largest private
sector bank, and global payment processor First Data have formed a
merchant-acquiring alliance named ICICI Merchant Services. The new
venture has taken over ICICI Bank’s merchant acquiring portfolio,
representing 30 percent of the current Indian acquiring market.

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The joint venture will be 81 percent-owned by
First Data and 19 percent by ICICI.

It will look to build on the bank’s existing
portfolio of 150,000 merchants, with plans to reach 500,000
terminals in the next five years.

First Data believe that merchants in India
have previously viewed POS terminals as a loss-making business, but
argue that with the introduction of innovative products and
services, merchants can in future generate fresh revenue
streams.

“India is a strategic market for First Data,”
said David Yates, president of First Data’s international
business.

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“This new alliance gives us the scale and
presence that we can build from, with a highly regarded partner. We
hope our alliance will make a positive contribution to the Indian
economy, partnering with ICICI to provide specialised, world-class
merchant acquiring services to the market.“

First Data is reportedly investing around $80
million in the joint venture, with around 300 employees of the bank
expected to transfer to the new business.

“We continue to work towards optimising and
improving the efficiencies of our business, to meet customer needs
effectively and increase service quality,” said Sandeep Bakhshi,
deputy managing director of ICICI. “By partnering with a leading
global player like First Data, we are able to expand our service
offering to our merchant customers.”

The deal does not, however, include
ICICI’s ATM business, contrary to reports last year that the bank
was looking to sell off its ATM network.

Outsourcing their ATM networks has become an
increasingly popular strategy among Indian banks in the past
year.

First Data partnered with YES Bank last July
to establish a network of ATMs across various cities in India,
leveraging its technical expertise to support the bank in
identifying locations, delivering installation and field management
services including 24/7 monitoring and vendor management.

Axis Bank, with a network of 4,000 ATMs, is
reportedly close to finalising its outsourcing vendor while the
country’s largest lender – State Bank of India, with a network of
17,000 ATMs – outsourced 500 units last year with plans this year
to outsource a further 1,000 ATMs.

ATM transactions in India have soared by
around 40 percent in the past year since the Reserve Bank allowed
account holders to use any ATM in the country without charge for
five withdrawals up to INR10, 000 a month ($219.5)

IT Contracts

RBI Fintech DealWatch tracks recent major
technology contract wins with a focus on the retail financial
services industry as well as fintech mergers and acquisitions and
innovative new product launches

Country

Participants

Type/value

Details

Date

New Zealand

Westpac New Zealand, NCR

ATM contract win

NCR Corporation has signed a multi-million
dollar deal with the New Zealand unit of Westpac. By June, more
than 400 units – 80 percent of the bank’s network – will be
replaced with NCR’s next generation SelfServ ATMs. As well as ATM
hardware and software, the deal includes on-site maintenance,
remote support and helpdesk services for up to nine years in
renewable
three-year terms.

20 Jan

Qatar

International Bank of Qatar, First Data

Processing contract win

First Data has agreed a four-year processing
deal with International Bank of Qatar, incorporating the full
spectrum of card processing services, ranging from front-end
services in card application management, transaction processing,
authorisations, clearing and settlement, to card account
management, loyalty processing and fraud management solutions.

13 Jan

Vietnam

Saigon Bank for Industry and Trade,
SunGard

Internet banking software contract win

Saigon Bank for Industry and Trade is to
deploy SunGard’s Ambit Online software to extend its internet
banking services. The 64-branch bank implemented the vendor’s core
banking software during 2008-2009.

13 Jan

Romania

Banca Transilvania, Sun Oracle

Data management contract win

Romania’s largest locally-owned private
sector lender Banca Transilvania, has become the first bank in the
world to implement Sun Oracle’s Exadata Database integrated system.
In a statement, the bank said it had plans to undertake a number of
IT projects in 2010, including replacement of its card issuing and
acceptance system as well as a planned upgrade of its online
channel.

13 Jan

Kuwait

National Bank of Kuwait, First Data

Processing contract extension

National Bank of Kuwait has extended its
existing processing contract with First Data which dates back to
2001.

13 Jan

Germany

Deutsche Postbank, Aim Software

Data management contract win

Deutsche Postbank is to implement Aim
Software’s data processing Golden Copy software.

13 Jan

UK

Experian, I-SEC Technolgies

Joint venture

Experian has teamed up with identity document
authentication vendor I-SEC Technologies to provide document
checking technology to be used in bank branches and other
high-volume organisations.

12 Jan

Country

Participants

Type/value

Details

Date

US

Peoples State Bank, Jack Henry

Core banking contract win

Wisconsin-based regional lender Peoples State
Bank is to deploy Jack Henry Banking’s SilverLake core processing
system to provide enterprise-wide automation.

12 Jan

Finland

S-Bank, SAS

Data management contract win

Finish-based supermarket bank S-Bank is to
implement data storage and management software from business
analytics software and services vendor SAS.

11 Jan

US

Integrated Bank Technology, State Bank of La
Junta

Data processing contract win

Core processing and imaging software vendor
Integrated Bank Technology has agreed a deal to supply
Colorado-based State Bank of La Junta with its Integrated Image
Teller product.

11 Jan

UK

Barclays, Accenture

Outsourcing deal cancelled

Barclays is to end a six-year, £400 million
($652 million) IT outsourcing contract with Accenture when it
expires in June, taking the work back in-house.

11 Jan

China

Longtop Financial Technologies, Giantstone
Information & Technology

Acquisition

China-based software developer and solutions
provider Longtop Financial Technologies has agreed a deal to
acquire local core banking solution provider Giantstone Information
& Technology.

11 Jan

US

Heartland Payment Systems, Visa

Dispute settlement

US-based payment processor Heartland Payment
Systems is to pay up to $60 million to issuers of Visa-branded
credit and debit cards affected by a data breach suffered at the
processor in 2008.

8 Jan

Germany

Degussa Bank, TSYS

Processing contract win

German-based Degussa Bank has agreed a
multi-year outsourcing deal with US-based card
processor TSYS.

7 Jan

US

Merced School Employees Federal Credit Union,
Fiserv

M-banking services contract win

Merced School Employees Federal Credit Union,
is now providing members access to mobile financial services via
Fiserv’s Mobile Money service.

7 Jan

France

Temenos, Viveo

Acquisition

Swiss-based core banking vendor Temenos has
agreed the biggest acquisition in its history, an
$81 million deal to snap up French-based rival Viveo.

6 Jan

Japan

Experian, A-Care Systems

Acquisition

Credit information firm Experian has taken an
88.5 percent stake in Japanese email marketing company A-Care
Systems for an undisclosed amount. A-Care had revenues of ¥2.6
billion
($28.3 million) in the year to 30 September 2009, with assets of
¥1.5 billion, and will form part of Experian’s permission-based
email marketing and customer intelligence services unit, Experian
CheetahMail.

5 Jan

US

EMC, Archer Technologies

Acquisition

Data storage vendor EMC is to acquire
US-based security, risk and compliance software firm Archer
Technologies.

5 Jan

UK

Lloyds Banking Group, Teradata

Marketing contract win

The UK’s largest retail banker, Lloyds
Banking Group, is to roll out Teradata Relationship Manager
software for customer communications and analysis across its Lloyds
TSB, Halifax and Bank of Scotland retail brands.

4 Jan

US

Verifone, Clear Channel

Acquisition

VeriFone, the US secure payments provider has
acquired the Clear Channel Taxi Media business from Clear Channel
Outdoor.

4 Jan

France

Gemalto, Xiring

Acquisition

Gemalto has closed the deal to acquire
French-based card authentication vendor Xiring (see RBI 623). The
cash transaction of €20 million ($29 million) covered all Xiring’s
activities concerning authentication solutions based on EMV
standards for online banking and e-commerce.

31 Dec 2009

India

IBM, Sardar Bhiladwala Pardi
People’s Co-operative

Managed continuity services

IBM has signed a 10-year information
technology services agreement with Sardar Bhiladwala Pardi People’s
Co-operative Bank, one of the leading co-operative banks in
Gujarat. As part of the deal, IBM will provide the bank managed
continuity services comprising server management, network and
security management and back-up and database management.

28 Dec

2009

Brazil

Redecard, Discover Financial Services

Processing contract win

Brazilian-based credit-card processing
network Redecard SA has agreed a deal to handle transactions from
overseas holders of Discover Financial Services within Brazil,
making Redecard the first Brazilian processor to accept Discover
cards.

23 Dec

2009

Belgium

ING Belgium, Atos Origin

Card services contract renewal

French-based IT services group Atos Origin
has extended its payment card services contract with ING Belgium
until the end of 2013. In addition to existing services, including
the processing of all the bank’s debit and credit card payment
transactions, Atos Worldline will be exploring new opportunities
together with ING Belgium. Atos Worldline services cover the
processing of all ING Belgium
payment transactions for their 2.3 million debit and credit
cards.

22 Dec

2009

China

Guangdong Rural Credit Union, TCS

Core banking contract win

Guangdong Rural Credit Union, the largest
provincial credit union in China, has successfully gone live with
TCS BaNCS Core Banking solution.

21 Dec

2009

France

Crédit Agricole,
Wincor Nixdorf

Self-service contract win

Crédit Agricole is to control its 22,000
self-service systems throughout Europe with Wincor Nixdorf’s
ProClassic/Enterprise Retail Banking Solution Suite following a
major software contract win by the German-headquartered vendor.
Previously, the bank has used a variety of software solutions to
operate its self-service networks of ATMs, transaction terminals
and statement printers.

16 Dec

2009

US

KaChing

Capital raising

Social investment website start-up KaChing,
launched as an SEC-registered investment adviser and pitched as an
alternative to mutual funds, has raised $7.5 million in a financing
round.

16 Dec

2009

South Korea

SK Telecom, Hana Financial

Acquisition

South Korean mobile carrier SK Telecom is to
purchase 49 percent of Hana Card, part of South Korean banking
group Hana Financial Group, making it the first telecoms operator
in the credit card market with an estimated $350 million stake in
the Hana card unit.

11 Dec

2009

Source: RBI