Banctec Inc. has received a $1.6 million order for its check processing system from HCL-Hewlett Packard, a technology company that will install the system at the Reserve Bank of India.
HCL-HP, based in Delhi, was recently chosen by the Reserve Bank to design and implement a large-scale check clearing system at the bank's Bombay operations center.
Under terms of the agreement, HCL-HP will provide the bank with Hewlett- Packard file servers, personal computers, and other system components.
Banctec will provide four document transports, its Transaction Processing System, and check clearing software.
The system is expected to go live in three months.
The Reserve Bank is installing the system to prepare for the significant increase in check processing volumes expected in coming years.
"The Indian financial industry is headed for rapid growth," said Ajai Chowdhry, president and chief executive officer at HCL-HP.
As the primary clearing center for India, the Reserve Bank - which processes 750,000 to 1.2 million items per day - will need to handle the country's increasing check volume. Volume has grown at a rate of 12% per year, according to Banctec officials.
Banctec's system will boost the processing power of the bank's existing check processing equipment from International Business Machines Corp.
The agreement with HCL-HP is Banctec's first in India, and the companies expect additional business.
"For several years we have felt that India offered excellent growth opportunities for Banctec," said chairman and chief executive officer Grahame N. Clark Jr.
"With a population of over 900 million people and a steadily growing economy, the market for check processing solutions in India should continue to expand throughout this decade."
India's check clearing methodology is very similar to that used in the United Kingdom. The similarities enabled Banctec to base its India installations on products previously developed for the Bank of England and other international financial institutions.