EDS has launched a world-first payment card utility in Australia to make it easier for financial institutions to modernise and manage card services in an increasingly competitive market.

The Regional Cards Utility gives banks and other credit providers access to the latest technology and business systems under a shared services model.

EDS Australia managing director, Chris Mitchell, said EDS had made a significant investment on developing an Agile Card Framework, the software infrastructure that drives the new service.

"The regulation of interchange fees by the Reserve Bank has opened up the payment card market and placed pressure on financial institutions to remain competitive," Mitchell said.

"Our utility provides card processing for multiple institutions, driving down costs by up to 50 per cent and allowing them to deliver new customer services that are quite separate and unique.

"We're offering payment and card providers the latest technology, vastly improved economies of scale and rapid time to market for new products."

The Regional Cards Utility currently processes 70 million transactions a month across both issued and acquired transactions.

The infrastructure developed by EDS has an initial capacity to process 10-15 million card accounts.

Dee McGrath, the former general manager of consumer and commercial cards at National Australia Bank, has been appointed director of the new utility for both Australia and New Zealand.

She said EDS was offering a card processing environment that used the latest technological and operational approaches, something few companies could achieve in isolation without huge up-front fixed costs.

"Products such as pre-paid, scheme debit and chip cards are driving unprecedented growth in micro and online payments, an area in which large banks are struggling to maintain a competitive edge," she said.

"Banks need modern IT platforms that can accommodate higher volumes and an ability to introduce new products.

"Future success will hinge on operational efficiencies, but many of the IT systems banks use for processing payment cards have remained unchanged for 20 years."

As a result the industry was under increasing pressure from overseas entrants who could offer customers a more flexible and innovative service.

There was also a shift in the balance of power at the merchant end of the market, with demands for greater choice, tailored services and differentiated pricing.

"Merchants now have the ability to choose from new entrants with deep pockets and new technologies which is typically delivered at a lower price,"McGrath said.

"The changing payment card environment will make it increasingly attractive for banks to outsource the management and processing of their card products and merchant transactions."

The technology and business service model introduced by EDS allowed financial institutions to transform payment card services and re-engineer back office processes without the normal associated risks, according to Vinnie Calo, director of global card services at EDS.

"It's a seamless environment for customers, with banks able to promote and protect their own brand and unique services," Calo said.

"Our experience, both regionally and globally, will continue to deepen as we roll out the EDS Regional Cards Utility to other areas."

EDS provides card-related services in some 18 countries and in the Asia Pacific region it processed 20 million credit card accounts and 1.3 billion credit card transactions a year.

Some 25,000 EDS employees work on finance-related projects for about 200 customers in 30 countries for clients such as ABN Amro, Aon, Bank of Canada, Bank of Queensland, la Caixa, CIBC, Commonwealth Bank Group, KBC, Korea First Bank, Lloyds TSB, Royal Bank of Scotland, Societe Generale, Visa and Westpac.