First Data and European banks team up

First Data Corp., a global leader in electronic commerce and payment services announced May 21 that it has signed an agreement with EUFISERV and its fifteen shareholders, which includes twelve European banks and banking organizations, with the intention of expanding and developing the European inter-bank processing network that is managed by EUFISERV.

EUFISERV, which is based in Brussels, provides inter-bank switching of Point of Sale (POS) and Automated Teller Machine (ATM) transactions, including authorisation, clearing, settlement and value-added services to payment card issuers, acquirers and payment schemes. EUFISERV together with First Data will further develop these services which will be compliant with the Single Euro Payment Area (SEPA) framework requirements.

The company will also be well positioned to service a new class of "Payment Institutions" created by the European Commission's Payment Services Directive (PSD). Connecting the existing networks of EUFISERV and First Data will create the opportunity for customers to access more than 74,000 ATMs, 1.5 million POS merchants and to reach more than 165 million debit and credit card accounts in Europe.

First Data is a leading payments processor, with a strong presence in Europe and operations around the globe. Prior to First Data's investment, EUFISERV was owned mainly by retail banks and banking organizations from twelve European countries and by the European Savings Banks Group. EUFISERV will provide support for ATM and POS transactions from multiple payment schemes, delivered through a single connection to create efficiencies for users. The reach of the network, which is expected to grow rapidly, will give a major boost to the creation of SEPA initiatives by making inter-operability possible between previously closed markets and increasing the choice of interbank providers.

EUFISERV formerly operated an ATM card scheme that provides cardholders from member banks with access to cash at more than 60,000 ATMs in nine European countries. In line with SEPA requirements, the EUFISERV card scheme has already been spun off into a separate company, EUFISERV Payments SCRL. Upon closing of the transaction, First Data will acquire a 50 percent equity stake in EUFISERV's interbank processing business, which will be renamed to reflect the new joint ownership structure.