Both contracts are part of a UK government drive to reduce "financial exclusion" of citizens without conventional banking facilities and will include low cost bank accounts and the electronic payment of social security benefits.

IBM has been commissioned to provide a secure IT infrastructure, dubbed the Network Banking Engine, to handle processing of transactions being routed to and from the organisation's retail Post Office branches. NBE will be supported by eFunds' EFT products, Connex and DataNavigator.

EFunds will also provide a range of services to IBM associated with the NBE, including a number of complex interfaces to the UK banking networks, consultancy, project management and implementation services.

Connex which sits on the IBM S/390 platform, uses Parallel Sysplex architecture as the routing and processing engine for all transactions, while DataNavigator assists with transaction analysis, settlement and reconciliation.

Seperately, EDS has signed an eight-year contract to provide electronic benefits transfer (EBT), customer relationship management (CRM) and debit card and application processing services to the Post Office.

"This deal will allow customers to access benefit payments in cash at Post Office branches through the card," says Graham Halliday, banking partnerships director, Post Office. "This is a key development in extending the banking services that the Post Office will offer in the future."

Under the new system, EDS services will enable the issuing of cards; the opening of accounts; the receipt of automated payment (including reconciliation settlement); the dispatch of statements; and PIN advice. EDS will work with Citicorp EFS, to deliver these services from EDS facilities in Cheadle. In addition, EDS will provide CRM services from its contact centre in Preston.

The company already partners with Citibank in the US to provide EBT services in 35 states.