JPMorgan and First data to dismantle payment processing JV

JPMorgan and First data to dismantle payment processing JV

JPMorgan Chase and First Data have disclosed plans to wind down the Chase Paymentech Solutions (CPS) joint venture by the end of the year and bring the operations in-house.

The CPS venture was established in 2005 through the combination of the bank's Chase Merchant Services division and First Data's Paymentech merchant businesses. In 2007 the unit processed around 19.7 billion payment transactions, with more than $719 billion in annual bank card and debit volume.

But now the partners say after reviewing the JV they both concluded that the payments and merchant-acquiring businesses were "core to their strategies" and each owner's share of the venture should be operated independently.

After the transition, JPMorgan Chase and First Data will operate separate payment businesses.

JPMorgan Chase will retain 51% of the JV's assets, including most CPS employees, the unit's Canadian and European operations and Dallas headquarters.

The bank says it will name the payments and merchant acquiring business Chase Paymentech.

Meanwhile First Data will assume management of the full-service ISO and agent bank unit of CPS. The e-payments vendor will also integrate 49% of the JV's assets and a portion of the employees into its existing merchant acquiring business.

Commenting on the move, Gordon Smith, chief executive of JPMorgan Chase's card services group, says: "With emerging opportunities in the global payments business, it makes good sense to bring our stake in Chase Paymentech business fully in-house. Merchants are moving beyond traditional payment vehicles and we expect to be at the forefront of the industry, developing and investing in new forms of payments and related transactions that bring value to merchants."

"We remain committed to the bank alliance model and value the successful relationships we have with our financial institution partners," adds Brian Mooney, president of First Data's merchant services group. "We look forward to working with JPMorgan Chase in other areas of business."

Comments: (0)

sponsored

Visit info.nice.com
Visit fsisac-summit.com/AP19-Registration

Trending Stories