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National City Corp. has agreed to move most of its debit transactions and
some of its processing work to Visa Inc., which has been trying to expand its debit
relationships with banks.
The agreement, announced Monday, will significantly change National City's 12-
year relationship with First Data Corp., which processes the Cleveland-based
company's credit and debit card purchases and routes some of its PIN-debit and ATM
transactions across its Star electronic funds transfer network.
National City has agreed to use Visa's Interlink point-of-sale and Plus ATM
brands as its primary PIN-debit networks. In addition, National City will transfer the
processing of those transactions to the San Francisco-based payment company. Mark
Ford, National City senior vice president and group product manager for consumer
and business lending, said in an interview Monday that his company will maintain a
"smaller" relationship with First Data.
"They're still a very strategic partner," but after a competitive bidding process for the
issuer's business, "we felt like Visa's entire package of processing services just fit our
needs more effectively." He would not discuss specifics of the deal,
except to say that it was "not a purely financial decision" for the issuer.
The expanded relationship with Visa will allow National City to "integrate all our
payments into one stream of payment processing" and "have better access to data
analytics and operational processes," Ford said.
National City will transfer the point-of-sale debit and ATM-processing business to
Visa's Debit Processing Service, which handles several types of payments and
offers "real-time" risk analysis on online transactions.
Visa said it will handle the increased duties as part of a "renewed and expanded"
multiyear brand agreement with the issuer. Ford would not disclose the length
of the contract but said the companies are negotiating a start date, and it will not
begin before next year.
Nancy Etheredge, a First Data spokesperson, said Monday: "National City remains
an important and valuable customer for First Data" and the "will work closely with
National City and Visa to ensure a smooth transition when our contract for PIN debit
and terminal driving ends at the end of the 2009."
