Sainsbury's Bank, the 50/50 joint venture between the supermarket chain and Lloyds Bank, will outsource its entire banking IT platform when Sainsbury's takes complete control of the financial services organisation.
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Sainsbury's is buying out Lloyds Bank's 50 per cent stake in the company in a £248m deal. When the deal is complete, it will migrate customers from Lloyd's IT infrastructure to an outsourced banking system provided by FIS Global.
"Over a 42-month period, the bank will transition support and back-office services away from Lloyds Banking Group," said Sainsbury's in a statement.
It continued: "Call centre services will be provided in-house by the bank and banking platforms will be delivered by FIS [Global]. FIS has a proven track record in successfully delivering similar types of outsourced services. All parties have been working together for a number of months to agree a detailed transition plan."
The statement concluded: "The transition will involve the transfer of data from legacy Lloyds Banking Group systems to the latest generation banking platform. This platform will allow a greater degree of flexibility, enabling new product launches and facilitating a much improved digital offer to customers."
FIS, a New York Stock Exchange-listed software company, will provide "a fully integrated real-time core processing and back-office IT solution to Sainsbury's Bank and deliver transition support as the bank moves its back-office services from Lloyds Banking Group to FIS," claimed FIS in a statement.
The system will "support the bank's deposit, savings, loan and credit cards accounts, and deliver seamless channel integration to enable customers to access their accounts through telephone, internet and mobile devices. The entire operation will be hosted and run by FIS in the UK", it added.
"Sainsbury's plans to extend their banking services will increase competition by introducing a new and exciting player to the UK banking market," said Mark Davey, executive vice president of international at FIS Global.
Sainsbury's Bank was launched in 1997. Sainsbury's supermarket hopes that the bank will complement its broader business, cross-selling banking and financial services to its upmarket customers.
"Developing complementary channels and services to the existing supermarket business is a core part of Sainsbury's long-term strategy for growth and the bank has been an increasingly successful part of that development," continued Sainsbury's statement.
It continued: "Full ownership will allow future products to be even more tailored to Sainsbury's customers, leveraging Nectar [loyalty card] data to drive sales 'uplifts' in both financial services and the core supermarket business.
