The ATM Solutions Group has bought BDB, the electronic funds transfer (EFT) and payroll specialist previously owned by Absa Bank and Nedbank.
ATM Solution Group is a wholly-owned subsidiary of Transaction Capital.
Steven Kark, CEO of Transaction Capital, says the ATM Solutions Group is concluding new Service Agreements with both banks "which will ensure that the services which they provide to BDB will continue under the same terms as prior to the transaction".
The acquisition is effective from 1 March 2008.
Kark says the acquisition helps the ATM Solutions Group to position itself as a full service provider within the National Payment System (NPS).
"However, what makes this deal significant is that EFT is the only element of service provisioning in the NPS that we are not currently engaged in. As a company we would be failing if we did not take full advantage of our reputation and capabilities – to fulfil our desire to be seen as a full-service non-bank participant in the NPS – by adding EFT functionality to our suite of services.
"Purchasing BDB combines scale of operations with proven technology and an experienced staff – and an existing customer base. This would have been difficult to replicate through organic growth."
BDB has been operating in the South African market as an EFT bureau for the past 35 years. The company has traditionally focused on offering debit order collections and credit EFT services, but recently identified payroll solutions as a key product which would provide access to additional EFT credits.
In line with this strategy, the company developed an Internet banking integrated payroll solution, i-Payroll, for small and medium businesses. It also launched another Internet-based payroll product called e-worx, catering to the more sophisticated corporate client.
Both these products are currently marketed and distributed via the Absa and Nedbank Internet banking platforms.
BDB processes payrolls in excess of R15-billion in value per annum and has a client base of more than 2 200 companies spread across the different industries in South Africa.
BDB is headquartered in the Johannesburg CBD and has regional offices in Cape Town and Durban. The company employs 68 people.
The ATM Solutions Group currently operates the largest third-party financial transaction switch in South Africa – and is widely acknowledged as the benchmark in the payments arena. It is a service provider to eight banks and a cross section of South Africa's leading retailers. It operates through six subsidiaries which share a common processing platform and back-office infrastructure. Industry-wide certifications and a national network of service engineers enhance the service.