Bank of America Corp. and Wells Fargo & Co. are ending a joint venture they formed three years ago to develop a system to process automated clearing house payments, spokespeople for the banks said Monday.
"I do know that acquisitions changed our business model and specifically the technology needs," Gabriel Boehmer, a spokesman for Wells Fargo, said in an interview.
B of A and Wells Fargo announced the formation of Pariter Solutions LLC in May 2008 with the intent of forming a single platform for processing their "on-us" ACH transactions, or those in which the payer and payee are customers of the banks. They planned to offer the service to other banks.
Pariter's service eliminates the need to route them through the Federal Reserve's FedACH or The Clearing House Payments Co.'s Electronic Payments Network, the two main providers of ACH processing services for banks.
In an emailed statement provided by Wells Fargo, the bank said it and Bank of America "expect to be more efficient and better able to serve clients by remaining separate rather than continuing to pursue the joint venture."
"Pariter was based on prior business strategies," the statement said.
"Since Pariter was announced, we have both made large acquisitions that have changed our business models and technology needs. We reached this decision amicably," it said.
The news comes less than two weeks after B of A and Wells announced they and JPMorgan Chase & Co. were joining forces to create clearXchange, a joint venture that will allow their consumer customers to send electronic payments to other customers from their checking accounts online.
The service will use the ACH network, executives overseeing the new service said. Their goal is to offer the service to other banks.