Ibm Global Eyes Equity Stake In Equifax Venture

IBM Global Services, the services arm of IBM in India, has set its eyes on Equifax Venture Infotek for strategic investment as part of its expansion plans in the country.

It is understood that this will be first step in IBM Global plans to make strategic investments in a string of companies in the country.

IBM Global Services is initially planning to pick up 5-10 per cent stake in Equifax, a start-up company which focuses on payment processing for credit and debit cards.

Without denying this move, an official spokesperson of IBM Global Services in a statement to Business Standard said, "There is nothing in the offing."

 

"We have a strategic relationship with Equifax and we will constantly work towards ways to grow this strategic relations stronger."

Equifax Venture is 50:50 joint venture between $1.7-billion Equifax of US and Venture Infotek in India.

While Equifax is one of the global leaders in providing financial information and processing solutions, Venture Infotek is a major provider for automated transaction solutions to banking industry in India.

On the other hand, IBM Global is a 80:20 joint venture between IBM and Tata Sons and is an end-to-end services company offering its expertise in industries ranging from banking to manufacturing to system software and hardware design.

Industry analysts tracking IBM Global indicate that this route of investing in promising companies with cutting edge technology will aid the growth of IBM Global in the country.

Interestingly, IBM Global has an eight-man team managing Equifax Venture Infotek centre in Mumbai for round the clock service for its customers across Asia.

Tata IBM, another 50:50 joint venture between IBM and the Tatas, is also a strategic partner in this company for providing technology.

With an immediate focus on the credit card payment processing in India Equifax plans to grow into providing advanced services for other consumer payments as ATM and smart cards in addition to debit cards.

The company started around 6-months before has invested around Rs 36 crore in its Indian operations, and this sum has been brought in equally by the two joint venture partners.

Equifax has set up the imperative infrastructure for an easy entry for banks wanting to provide credit card services and this infrastructure encompasses the front-end as well as the back-end services.

This system, according to the company, allows banks to automatically carry out credit scoring for new applicants, automatic collections' management and recovery follow-up for delinquent accounts.

IBM Global Services started a year ago has reportedly posted a net profit of Rs 2 crore on a turnover of Rs 80 crore.