Newcastle Building Society is planning to introduce a debit
card payments service in the third quarter of 2004 using a
third-party service which involves little extra work for its IT
department
The UK's 13th largest building society has signed a contract with
application service provider Nomad Software to provide the IT
infrastructure to allow it to enter the card payments market for
the first time.
Colin Greaves, general manager at Newcastle Building Society, said
the application service provider-based service offered by Nomad
proved cost-effective for the building society to issue debit cards
as it extends its financial product portfolio.
"It is very expensive to run your own debit card [system] as it
requires major infrastructure," he said, but added that this was
something the society was not prepared to invest in.
Greaves expected integration of the service into the society's
existing IT infrastructure should pose little problem for the team
of 40 IT staff at Newcastle Building Society.
"We have the basic administration in place. It is fairly easy to
take a transaction feed," he said.
The society had already implemented real-time transaction feeds via
its internet account which takes a feed from Fidelity Investments.
"This is a logical extension of the infrastructure already in
place," Greaves said.
When it is introduced later this year, the debit card service will
enable Newcastle to issue MasterCard's Maestro card to its
customers.
Debit card transactions from Nomad will be fed using web services
into the building society's infrastructure, which runs on Windows
2000, Windows 2003 and Microsoft SQL Server.
Greaves said the plan was to migrate onto Microsoft's .net
architecture, which supports the development of a web
services-based infrastructure.
He expected the link to Nomad to be achieved over a virtual private
network, although no decision had yet been made on network
connectivity.
Through the agreement with Nomad, Greaves said Newcastle Building
Society would be able to provide debit card services to other
building societies, effectively acting as a reseller of the Nomad
service.
The Nomad service, called Cortex, runs at an IBM-hosted site. The
service manages card production, personalisation and Pin mailers to
customers.