Fiserv is migrating clients to one of its two debit networks and will sell the other, if it receives a suitable offer; otherwise, it will wind down one network, Chief Executive Officer Takis Georgakopoulos said.
That migration will conclude “over the next few quarters,” setting up the potential sale, he said Tuesday at the Citi 15th annual fintech conference. Fiserv owns the Star and Accel debit networks. Analysts have predicted that Accel is more likely to be sold at some point as part of a broader Fiserv portfolio review of its business.
“Having a debit network is a key competitive advantage for Fiserv,” Georgakopoulos said, adding that the company doesn’t need two of them. “For that empty network, we are going to look at if there is an alternative network structure that makes sense,” he said, without elaborating on which network Fiserv would retain.
The networks “are almost interchangeable in terms of their capabilities,” he added.
In July, the Wall Street Journal reported that banks including Bank of America, JPMorgan Chase, PNC Financial Services Group and Wells Fargo had held preliminary talks with Fiserv about a debit network sale. Fiserv provides technology services to financial institutions in addition to processing services for merchants.
Georgakopoulos took over as CEO in June, when CEO Mike Lyons resigned to lead Truist Financial. Since then, he has started a review of Fiserv’s assets, some of which were acquired when the company bought First Data in 2019. Milwaukee-based Fiserv has also scooped up many smaller companies over the past decade.
That review identified “more than a dozen small businesses” that offer “either no growth and/or no profitability that we will shut down over a short period of time,” the CEO said.
“Obviously, we need to be careful with customer impact, etc., and make sure we have the right solution for clients,” he said. “But these are things that are dragging down growth, dragging down profitability, and are taking away from the focus that the company needs to have to deliver on its core priorities.”
