Citi has agreed an outsourcing agreement with First Data, handing over the core processing elements of its US lockbox operations.
Under the deal, First Data will provide lockbox, image capture, posting and reporting of receivables for corporate billers. The firm says it will offer jobs to the 500-odd existing Citi staff in the unit and sublease the bank's lockbox processing facilities.
Citi says it remains committed to clients and will continue to be their direct point of contact for sales and service.
Amol Gupte, head, treasury and trade solutions, North America, Citi, says: "For Citi, this will result in a more competitive position in the market while providing a scalable platform and the long-term infrastructure to enable us to meet the growing geographic scope and sophistication of our clients' needs."
Matt Kardell, SVP, sales and strategic relationships, First Data, adds: "Through this agreement, we are able to expand our geographic footprint for remittance and lockbox services, particularly in the Midwest, and utilise the technology and scale that we bring to the marketplace on behalf of Citi and its clients."
Citi is following in the footsteps of JPMorgan, which announced a deal in April to sell its national retail lockbox business to Indian IT company 3i Infotech