Dutch banking group ABN AMRO is planning to use IT systems introduced to support the introduction of a Europe-wide payments market to provide processing services to other banks.
ABN AMRO has invested heavily in technology to support the Single European Payment Area (Sepa), and will offer its core payment processing technology - which has been adapted to deal with payments under the new system - as a service to banks wishing to outsource.
Sepa is the European Commission's initiative to create a payments market across the Eurozone. Sepa payments will be made available from January 2008.
"Because of Sepa we are currently seeing more banks looking to outsource this activity. We have been investing in Sepa since its inception. Obviously bringing more scale and volume to our platforms both generates a revenue stream and also helps bring down our internal unit costs," said Mike Hampson, head of financial institutions and transaction banking at ABN AMRO.
The Royal Bank of Scotland is also working towards being able to process Sepa payments. "We will be offering processing services to other banks," a spokesperson said.
Barclays said it would manage Sepa internally. "We always look at the options of insourcing and outsourcing, and insourcing is the best way in this case," a spokeswoman said.
HBOS said it is watching the situation closely and is likely to make an announcement before the year end.
A spokeswoman at Apacs, the UK payments association, which has been giving the UK perspective on Sepa to the European Commission, said banks in the UK will be expected to offer Sepa services to their corporate customers.
"Banks will be well aware of corporate customers' needs and can either tap into Sepa directly, continue with existing systems and wait and see what demand for Sepa is like, or they can process payments via other banks," she said.
There will be an opportunity for banks with the right infrastructure to attract outsourcing customers, according to last week's World Payments Report 2007, published by ABN AMRO, Capgemini and the European Financial Management & Marketing Association. The report revealed that 58% of banks will outsource Sepa payments.