About that box hovering over First Data’s home page

Screen Shot 2019-08-07 at 9.31.10 PMIf you happen to visit First Data’s home page, you may notice a big, blue rectangle hovering it. It says, “First Data is now Fiserv.” 

It was in January of this year that Fiserv and First Data announced plans to become one company under the Fiserv name. Now, seven long months later, the deal is complete. Accuse me of hijacking my own blog to bring you news about my employer if you will, but I think it’s justified. This is a newsworthy event I’d be remiss to overlook. 

Besides, it’s nice to be able to brag to someone who gets it. If you’re reading this, odds are you’re already aware of Fiserv and First Data. My neighbors, not so much. When I tell them I work for Fiserv, experience has taught me to add a brief description without waiting for the inevitable “What’s Fiserv?”

Except in Wisconsin. There, Fiserv is a household word. This is partly because Fiserv makes its headquarters in Brookfield, a suburb of Milwaukee, and mostly because Milwaukee’s Fiserv Forum is home to the Milwaukee Bucks. There are no blank stares when I tell a Wisconsinite I work for Fiserv. Instead, I usually get, “You work for that Fiserv? Cool!” This is usually followed by, “What’s Fiserv?”

Don’t get me wrong. Working for Fiserv is something to be proud of. Its technology underlies and powers account tracking, payments processing, and mobile banking services for small banks to mega banks worldwide. There’s hardly a life that Fiserv doesn’t touch.

And its low public profile is by design. An unstated part of Fiserv’s mission is for my neighbors who love their suite of digital banking services to sing their bank’s praises, not Fiserv’s.

First Data, too, has maintained a low public profile. Of course, merchants are certainly aware of the company. They use First Data’s point-of-sale hardware at the cash wrap to accept payment and, thanks to First Data’s Clover® Station POS System, to accept it in pretty much any form.

The months between announcement and completion of the acquisition weren’t hurdle-free. For instance, the United States Department of Justice requested a stack of information. And then, another stack. I suppose that puts Fiserv in good company. I mean, why should Facebook, Google, and Amazon hog all the attention? With the deal complete, I’m going to assume the DOJ was satisfied. 

The purchase price was $22 billion, which is more than I make in a year. When plans for the acquisition were announced, the press was largely positive, even though it’s the press. The Wall Street Journal said that the all-stock deal “connects Wall Street to Main Street”:

Fiserv and First Data provide a range of technology services to banks, merchants and other companies involved in the business of moving money. Chief among those services: payments. Fiserv processes credit- and debit-card transactions for banks, while First Data handles the merchant side of the equation.

To wit, a Fiserv press release dated July 29 states:

As a global leader in technology and payments that enables commerce, banking and the safe and secure movement of money, Fiserv has the breadth of capabilities and depth of expertise to deliver unmatched value to clients. As a result of the combination, clients will have access to a more comprehensive set of solutions and innovations, an extensive range of end-to-end capabilities and integrated delivery, which enable differentiated value for their customers.

Even the Motley Fool rang in with a word of praise:

The agreement combines two companies in the financial services industry that surprisingly overlap very little in their core capabilities … Banks that subscribe to Fiserv’s platforms can now offer Clover as a default point-of-sale option to their business accounts. As [First Data CEO Frank] Bisignano put it, the deal “massively changes the distribution capability of Clover.”

This joining of forces is a positive step toward heading off a wave of upstart fintechs like Square that, as the WSJ put it, have “… muscled into the market in recent years, luring away potential customers [from traditional financial institutions] and threatening a major source of revenue”:

[T]he growing number of payment options for merchants has started to take a toll on the business. First Data has long relied on banks to funnel merchant clients its way, yet many businesses are turning to Square and other upstart rivals. First Data’s Clover payments station competes with Square’s signature white card readers that plug into smartphones.

Returning the Motley Fool: 

With Clover becoming a part of Fiserv, banks will have the same access to sales data that Square has and be able to offer loans to merchants in much the same way Square does now. For financial institutions losing market share to Square, that is a compelling proposition. [Italics added.]

“With the transaction now complete,” observed PYMTS.com, “Fiserv is one of the world’s largest payments and financial technology providers,” adding:  

[Fiserv CEO Jeffrey Yabuki said that] … the combined firms are primarily focused on their areas of synergy, particularly expanding technologies like point-of-sale lending, helping merchants get their money faster and using data in terms of “thinking about how to make better decisions around fraud and the like.”

Exciting times. I’m grateful to be able to play in this sandbox.

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