Uptake and customer experiences


As mentioned, SAP’s move into payments systems for financial services has revolved around Deutsche Postbank and its service centre, BCB. The project ran late but Postbank/BCB went live with the SAP Payment Engine in the summer of 2008. Within a six month migration period Postbank/BCB moved several legacy payment systems to the SAP platform, amounting to 90 per cent of its systems, according to Egetoft. At Postbank/BCB, it was meant to handle the payments of not only this large retail bank but also ultimately its outsource customers, comprising Deutsche Bank, Dresdner Bank and HVB at this time. The initial project consisted of several deliverables beginning with the first releases at the end of 2006. The kernel of that solution became SAP’s commercial offering, spanning both retail and corporate payments. While delayed, the SAP/Postbank payments system development reached the test phases by late 2007. It had been a similar situation with SAP’s new retail banking system, Deposits Management, which was also developed with Postbank – this project also ran late but eventually saw a commercial offering reach the market. The payments system needed to process 50 million


transactions per day and peak traffic of up to ten million per hour. Ahead of the cut-over, there had been tests in IBM’s labs in Montpellier. While Postbank was saying there were a few small problems, Ludger Dörr, the bank’s strategic projects director, claimed these were normal. The project on the core banking side meant the bank and supplier ‘knew a lot about each other’ prior to the start of the payments development, he added.


However, this looked to be an optimistic reading of the payments project. The first delay saw full production at Postbank reset for the middle of 2008. ‘This is a little bit later than planned but the reason is SEPA,’ said Dörr, in part because the rulebooks were not on time so there were some changes needed. The advantage was that the SEPA functionality would be delivered from the outset, so earlier than planned. The original emphasis had been purely on domestic payments, with the probable need if this had been the case for some workaround for SEPA. Dörr said the system would now support Postbank’s domestic and SEPA payments for retail and corporate banking. The migration


of the bank’s domestic mass market


payments started on a phased basis in June 2008, beginning with a small number of transactions. This was increased each week, reaching around 80 per cent of volumes by mid- September and with everything scheduled to have been moved across by the middle of October. At that point, the bank


would cease using its aging Kordoba system in this area, said Wolfgang Lücker, operations head within BCB. There were the ‘normal’ errors at the outset but these were manageable and were gradually reduced. Putting Postbank’s volumes into context, SAP’s head of financial services, Johan Kestens, pointed out that its five hour volume was equivalent to one year’s Swift traffic. The Postbank system ran on IBM Unix servers, with Oracle and NetWeaver. With regards SEPA payments, as mentioned, these had been expected to be in the first cut-over within the revised schedule. In fact, SEPA support, for both Credit Transfers and Direct Debits, was subsequently pushed back to the second half of 2009. Accenture, a partner of SAP for some years and heavily involved at Postbank, was blamed by the bank for the delays. Postbank was already running the existing payment systems of the three German banks that had signed for outsourcing. Migration of their business to the new system was to take place after the successful migration of Postbank’s own traffic. Indeed, the initial specifications for the platform had been laid down by Postbank, Deutsche, Dresdner and SAP in March 2004 (HVB was recruited some time later). The migration onto the new platform for the banks would now happen on a sequential basis, said Lücker, probably with one migration per year. This operation resided with BCB. The plan was then thrown into doubt with Dresdner Bank’s merger with Commerzbank. In the latter half of 2009, it was suggested that the former’s domestic payments were to be incorporated within Commerzbank’s own in-house set-up. By now, Postbank was looking beyond the country to try to expand its payments outsourcing. It was believed that there had been discussions centred on other outsource deals with at least one other major bank in German-speaking Europe, although nothing had come of this by mid-2009. Postbank was still planning to migrate the rest of its


payments to SAP; what remained on the legacy systems, according to Egetoft, related to specific services that had been difficult to migrate. SAP’s second customer for its Payment Engine was ATB, a


core system client in Canada. This had chosen SAP for a wide- ranging transformation project in mid-2008. Accenture was involved as a consultant. However, Commonwealth Bank of Australia, which had chosen SAP for core banking about the same time as ATB, subsequently picked Clear2Pay to provide a unified payments platform, although SAP was thought to have competed as well. More bad news also surfaced from ATB itself in early 2010 when it emerged that the core banking project as a whole was experiencing a major setback and budget review as it was running one year behind schedule


Payment Systems & Suppliers Report | www.ibsintelligence.com 253


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