ICICI Bank sells PoS network to First Data Corp

The country’s largest private sector lender ICICI Bank has hived off its point-of-sale terminals business into a $80 million (about Rs 368 crore) joint venture with US-based payments Solutions provider First Data Corp (FDC).

FDC will own 81 per cent stake in the JV, which will be called ICICI Merchant Services, with ICICI Bank holding the remaining stake.

The total valuation of the company was $80 million (about Rs 368 crore). PoS terminals are machines at merchant locations used to swipe credit and debit cards.

FDC is currently owned by private equity giant KKR.

The deal was struck a few months back, but was awaiting regulatory approval from the Reserve Bank of India (RBI). An ICICI Bank spokesperson confirmed that the bank had secured RBI approval for the deal.

Further details about the JV are expected in January. The bank has already communicated merchants using its terminals that the PoS network has been transferred to ICICI Merchant Services. ICICI Bank expects that the specialised company will bring down transactions costs and also grow the payment network more efficiently.

“More than unlocking value, we undertook the sale because the business has matured and is ready to take off on its own. The partnership with First Data will help bring best practices from abroad into the country,” said a spokesperson for ICICI Bank.

This is the first time that an Indian bank has hived off its PoS terminal network. Other large banks might also follow this move. Private sector lenders HDFC Bank and Axis Bank have the largest PoS networks in the country after ICICI Bank.