Bacs splits IT department in two

UK clearing house Bacs has restructured its IT department as part of a drive to develop new payment technology for banks and...

UK clearing house Bacs has restructured its IT department as part of a drive to develop new payment technology for banks and expand into the European clearing market.

The restructuring, which follows a wide-ranging business review, will create two new divisions: a "new ventures group" will develop technology, while a standards arm will govern the £3.7bn worth of direct debit and direct credit transactions processed by Bacs each year.

Later this year, Bacs is expected to hive off these two divisions into two separate companies, although it stressed that no final decision has been taken on this.

IT staff in the new ventures group will scan the payments market for opportunities and partner with software suppliers to develop services for banks. However, the bulk of Bacs' 200 IT staff will continue to support its IT operations and £75m technology overhaul, which includes a move to an Internet Protocol-based network.

Bacs said it is in discussions with banks over the potential to develop mobile payment services but it has not yet decided what technologies to develop.

With industry watchers predicting a consolidation of the European clearing market over the next few years, Bacs is keen to use its revamped network to offer services outside the UK.

"We hope it is a turning point in the history of Bacs," said Derek Barnby, corporate programmes director at Bacs. "We see ourselves as a key player in Europe and would like to extend our influence by adding new services."

The restructuring is also good news for IT staff, said Barnby, because they are being trained to work with more modern technologies.

Meanwhile, Bacs has gone live with an internet-based network which connects customers to its systems. Bacstel-IP, which incorporates public key infrastructure encryption technology, replaces its ageing private network.

In 2001, Computer Weekly revealed that the multibillion-pound clearing network was vulnerable to hacking attacks because the Bacs board had failed to implement recommendations from its IT department to introduce a PKI security system and services.

The new IP network will allow companies to receive electronic conformation that a payment has been received by Bacs rather than by post, as occurs under the current system.

How Bacs' restructuring will work   

  • The restructuring of Bacs' IT department will create two new divisions: a "new ventures group" will develop technology, while a standards arm will govern the £3.7bn worth of direct debit and direct credit transactions processed by the clearing house each year. 
  • IT staff in the new ventures group will scan the payments market for opportunities and partner with software suppliers to develop services for banks 
  • The bulk of Bacs' 200 IT staff will continue to support the clearing house's IT operations and an ongoing £75m technology overhaul, which includes a move to an Internet Protocol-based network.

Read more on IT jobs and recruitment

Start the conversation

Send me notifications when other members comment.

Please create a username to comment.

-ADS BY GOOGLE

SearchCIO

SearchSecurity

SearchNetworking

SearchDataCenter

SearchDataManagement

Close