Scotiabank has sold its merchant acquirer and smart card point-of-sale business to Dallas-based Paymentech for a minimum C$80 million after tax.
Paymentech says the purchase, encompassing debit and credit card payment services and smart card programmes offered to merchants in 95,000 locations across Canada, will enable the company to extend its business north of the border.
Under terms of the agreement, Paymentech will provide merchants a range of solutions from point-of-sale transaction services, to payment processing and reporting. Paymentech will also administer and provide all processing and reporting for Scotiabank's merchant smart card programmes.
Scotiabank says it will maintain its banking relationships with these merchants and continue to provide the clearing and settlement services associated with debit and credit card transactions. Scotiabank will also continue to market merchant products to its customers through a referral arrangement with Paymentech.
The bank says it stands to earn additional revenues in future reporting periods from the deal, subject to certain performance conditions.