Australia's New South Wales Government has carved up its transactional banking contract with Westpac, in the process handing out plum assignments for ANZ and Citi.
Westpac has been the sole provider of banking services to the NSW Government over the past four years, handling all institutional transactions including payments, receipts, cross-border banking and purchasing cards.
By volume the NSW Government’s banking transactions are believed to be the largest in the country. Each year the Government makes more than 13 million direct payroll payments and more than one million credit card payments. There are six million Eftpos transactions at Service NSW and other NSW Government outlets and more than 11 million payments made over the internet.
The new deal paves the way for ANZ to join Westpac in the provision of payments and cross-border banking services, while Citi wins a three-year mandate to handle all card payments.
Treasurer Dominic Perrottet says the new contracts are expected to save up to $5 million each year in fees and charges while providing a more streamlined approach to transactions, more payment options for customers, improved security and greater use of digital payment options.
“The finance sector is evolving rapidly, and the NSW Government has selected the providers who will ensure we offer both the best services to consumers, and are an early adopter of innovative technology and new ways of banking,” he says. “These contracts will also allow greater flexibility and as technology evolves, a better experience for the millions of people who transact with the Government each year.”
Awarded after an extensive tender process, the news is a major blow for Commonwealth Bank of Australia, which failed to make the cut despite its heavily promoted digital-first credentials.
The three-year contracts will commence in April 2019 with the opportunity available for parties to extend the agreement by up to three years.
ANZ has also been named as an innovation partners with the governing body, which will leverage the bank’s capability and experience in data analytics, agile ways of working, human-centred design, digital and payments.
ANZ group executive digital banking, Maile Carnegie, says: “Like banks, governments are facing changing expectations from their citizens and need to respond in a way that’s intuitive, flexible and innovative. The NSW Government is progressive in its thinking and we’re confident this partnership will draw upon our experience and expertise in digital banking and transformations to help drive that vision for the future.”