EDS Corp. has signed an agreement with Envoy, a bank card processor, to provide network access to regional and national debit card networks.

EDS will provide Nashville, Tenn.-based Envoy with links to 28 debit card point-of-sale networks, including Visa's national debit network Interlink; Cash Station, Chicago; Florida-based Honor; Most, in the South Atlantic states; New Jersey-based NYCE; Pulse of Texas; and the New England network Yankee24.

EDS, the Dallas-based subsidiary of General Motors Corp., has not yet signed a deal with MasterCard's Maestro system, Interlink's main national competitor.

Debit card services - in which consumer's bank accounts are automatically debited at the point of sale - have never taken off with consumers as its advocates have predicted.

Interest Is Increasing

Over the last year, however, interest has heightened with the emergence of two national debit card networks. Also spurring banks' interest is the growing success of regional POS programs in areas of the country such as the Northeast that previously showed little or no consumer acceptance.

EDS said its agreement with Envoy was not exclusive, and it is talking to others that provide electronic payment services.

Envoy, which operates bank card-reading terminals for merchants and health-care providers, has been a big processor of credit card transactions.

It is now expanding in the debit card business. It offers debit card services in a portion of the Northeast, using Core-States Financial Corp.'s MAC network as its processor.

Competition Possible

The agreement does not mean that EDS has decided to avoid direct competition with companies such as Envoy by providing point-of-sale terminals and processing services to banks and their merchant customers.

"We don't compete with Envoy today, but if we acquire the ability to drive POS terminals, we will compete," said Jeanne Staley, client relations manager at EDS. Ms. Staley said she believes that the business of providing terminals could be profitable.

"Companies that have built on credit are now seeing demand from merchants for debit," said Ms. Staley. One reason for greater demand, she said, is that the cost to upgrade at terminal with a keypad has dropped dramatically from more than $1,000 per terminal to between $200 and $300.

Consumers are also beginning to request debit card service, Ms. Staley said.

EDS will process card transactions, while Envoy arranges with the merchants' banks to put terminals into the retailer's checkout lines.

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