Direct Line begins two-year IT project to decouple from RBS

Direct Line Group has contracted Capgemini to build and run a new IT system as it separates from Royal Bank of Scotland

Direct Line Group has contracted Capgemini to build and run a new IT system as the insurer separates from its former parent, the Royal Bank of Scotland (RBS).

The insurer's corporate and business applications, currently run by RBS, will be migrated to the new system. The migration will take two years at a cost of £100m, with the total contract value substantially higher over its five-year duration.

Partly nationalised RBS has been forced to sell assets by the government, after being saved from collapse during the bank rescue package in 2008. This includes the sale of branches and former divisions, such as Direct Line and WorldPay.

Direct Line CEO Paul Geddes said the company had been planning to split systems from RBS. 

“Over the past few years we have been transforming the business and we are beginning to see the results. The planned work on our IT infrastructure is a key piece in this jigsaw, as Direct Line Group finalises its separation from RBS Group,” he said.

Former RBS payment processing unit WorldPay was sold in December 2010 to Advent International and Bain Capital for over £2bn.

WorldPay processes billions of credit and debit card payments to merchants every year. It processes the payment at the point of sale, authorises it, and transfers the money to the merchant from the bank or credit card company.

It was agreed that RBS would continue running the business on the bank's IT infrastructure until WorldPay had its own. In October last year, WorldPay's co-located datacentres became fully operational. The business aims to fully split from RBS’s IT infrastructure and stand on its own two feet in October 2013.



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