First Data Corp.'s decision to lay off 10% of its merchant processing division came to no surprise to industry experts, who said the move was an attempt to cut costs in an increasingly competitive business.

Citing the need to streamline operations, First Data Merchant Services announced Thursday that it was firing about 500 of its 5,200 workers. The unit also said it would close one of its 10 credit and debit card processing facilities, the one in Sunnyvale, Calif.

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