Facing a lackluster market for data processing software and services, Fiserv Inc. has struck a series of partnerships that executives and analysts said point to new focal areas including lending automation and stored value cards.
Taken together with agreements announced earlier in May, for digital image exchange with Viewpointe Archive Services LLC and Small Value Payments Co., partnerships Fiserv announced last week are bright spots in an otherwise mostly gloomy technology market.
The new deals are with the credit-scoring specialist Fair Isaac Corp. and with ATM National Inc., which operates the Allpoint cooperative automated teller machine network launched in April.
Dan Welbaum, the vice president of sales and marketing in the Fiserv lending solutions unit in Lake Mary, Fla., said Fiserv had integrated Fair Isaac’s LiquidCredit credit-scoring engine into the consumer lending component of its easyLender Consumer/Commercial loan-origination software, which is used by around 400 lenders.
“We have a much closer business partnership and a much closer technology-sharing partnership than we had before” with Fair Isaac, Mr. Welbaum said. “Now we’re working as a team with them to develop common solutions.”
The previous version of easyLender linked to an earlier Fair Isaac product called Credit Desk, Mr. Welbaum said in an interview Thursday. That product, residing on the lender’s data-serving computers, had an interface so employees could call for credit data, but bringing data into the loan application remained a manual process.
The updated version, being offered as an add-on module to the loan software, integrates credit-scoring more closely, Mr. Welbaum said. It uses Internet technology to fetch data for a loan application from within the origination software. The integration also enables automated approvals of borrower who meet a lender’s standard criteria.
“They can then use their underwriting staff for the exceptions,” Mr. Welbaum said. “It allows their people to be much more productive.”
Fiserv’s deal with ATM National, of Washington, involves payroll cards and a Fiserv affiliate, FSV Payment Systems Ltd.
The plan is to offer banks a payroll-card service for companies that have large, dispersed work forces of low-wage employees. The card gives employers the cost and security benefits of direct deposit for workers who may not have checking accounts, while providing surcharge-free access to funds through 23,000 cash machines in Allpoint.
Jackie Binks, the vice president of business development in Fiserv’s bank servicing group, called the service “the natural evolution of the debit card”; it provides banks with a new source of fee income and low-cost deposits. CCBT Financial Cos. Inc. of South Yarmouth, Mass., the parent of Cape Cod Bank and Trust Co., in May became the first customer for Fiserv’s payroll card.
The developments gave Fiserv’s stock a slight lift last week.
Andrew Jeffrey, an analyst at Needham & Co., who rates Fiserv’s stock a “buy,” said in an interview Thursday, “This company is looking for ways not only to augment its growth rate in the short term, but to position itself in the growth markets of the next several years.”
John Kraft, an analyst at D.A. Davidson & Co. in Lake Oswego, Ore., who has a “neutral” rating on the stock, said that, though the partnerships could help the company, “there has been some concern about Fiserv’s growth rates.” He noted that it has made more than 100 acquisitions in the past 15 years or so and said “there’s a certain amount of acquisition growth that’s just expected.”
Fiserv stock closed Friday at $33.12, up 7% on the week.
