Citicorp is reportedly close to joining the EDI Bank Alliance Network Exchange - Edibanx.
Sources close to the network, who requested anonymity, said Citi could be part of the fledgling network early next year. Citicorp executives declined to comment.
Citi's membership would be a huge boost to Edibanx, which is striving to demonstrate that it is a viable payments system for financial electronic data interchange.
The network, which is operated by the Chicago Clearing House Association, has been in operation for a little over a year and has been reportedly struggling to increase its transaction volume. Clearing-house officials declined to disclose transaction figures.
Edibanx is a computer-based, net-settlement clearing house for financial electronic data interchange payments, a potentially lucrative fee-based service for corporate trade payments.
Edibanx was developed to promote electronic data interchange growth among banks, and to address some of the shortcomings of using the automated clearing house network for such transactions.
The vast majority of financial electronic data interchange transactions are conducted through the ACH network using its CTX format for trade payments.
Though Edibanx executives believe they can change this situation, the network has had trouble attracting members because of its high membership costs, observers said.
Others noted that Edibanx also needs more financial institution "endpoints" to attract more members.
Adding the clout of Citicorp to a list of other influential members - such as Mellon Bank Corp., NationsBank Corp., BankAmerica Corp., Bank of Boston Corp., and Chase Manhattan Corp. - could help win over skeptical institutions.
Also working in Edibanx's favor are talks between the network and the National Automated Clearing House Association.
Nacha, the rule-setting body for the regional ACH networks, is exploring the possibility of creating an interface between the ACH network and the Edibanx network, according to William B. Nelson, executive vice president at Nacha.
"We are forming a task force to look at that, and it will be comprised of Edibanx members and other banks that are not Edibanx members," Mr. Nelson said.
