M'sian funds operator upgrades mainframe

Malaysian Electronic Payment System says it stuck with IBM mainframes for performance, and to minimize additional investment required from banks.
Written by Lee Min Keong, Contributor

KUALA LUMPUR--Despite intense market campaigning to lure mainframe users to migrate to high-performance servers, one mainframe customer is choosing to stick with the veteran platform.

The Malaysian Electronic Payment System (MEPS), operator of Malaysia's interbank funds transfer service, upgraded its existing mainframe infrastructure to the IBM System z9, to cater for the growth of its Interbank GIRO (MEPS IBG) service.

Sticking to mainframes

Work on the MEPS's mainframe upgrading project began in March 2008 and was completed end-2008.
The Malaysian organization invested some 4.4 million ringgit (US$1.2 million) in hardware and another 750,000 ringgit (US$205,200) for the software upgrade to IBM z9.
IBM Global Technology Services was engaged to implement the hardware setup and installation services at the production and disaster recovery sites for the MEPS.
The System z9 Business Class mainframe was deployed for both sites, and is integrated with the IBM System Storage DS 6800 and Tape Solution 1120.

MEPS IBG is an interbank funds transfer service that facilitates payments and collections through digitized transactions between banks.

The MEPS decided to stick with mainframes, rather than switch to high-performance servers, because it needed a robust and secure infrastructure, Mohd Hata Robani, the MEPS's group managing director, said in an e-mail interview with ZDNet Asia.

Mainframe customers such as the MEPS, are hotly sought after by server manufacturers such as Hewlett-Packard, which have been making aggressive bids to urge these clients to migrate. HP argues that mainframes are costly to support and lack the flexibility to effectively support businesses today.

The MEPS, however, said it chose to stay with the platform for better security and performance.

Mohd Hata explained: "As Malaysia's leading e-ACH (Automated Clearing House), the MEPS is focused on providing payment transactions that are simple, convenient and secure for member-banks and their customer. As such, we require a powerful and secure computing foundation, especially to keep pace with the growing number of transactions--in this case, we needed it for the MEPS IBG service."

The System z9 Business Class (BC) mainframe was deployed for the production and disaster recovery sites that support MEP IBG, and is integrated with IBM System Storage DS 6800 and Tape Solution 1120. The IBM 9672 Series G5 RA6 was previously used to support MEPS's IBG operations.

"The IBM z9 BC has the processing capacity and bandwidth to meet such requirements. In addition, the system has the required security capabilities to support the MEPS's security requirements," he said.

"Another important factor is that by adopting this system, our participating banks are not required to make any additional investment or changes to their current system," he added.

He said the new system provides "more stability and bandwidth", as well as security for initiatives to enhance customer service.

Mohd Hata said the IBM offering can support more than three times the bandwidth previously available to the MEPS. This will enable the funds operator to focus on reducing overall business costs, while consolidating and simplifying its IT management, he said.

"Currently, MEPS IBG operates two windows per day and with the new IBM z9 series, it will be able to support over 1 million transactions per window," he noted. "It also provides a better level of security which is critical in our operations."

In addition, other mainframe features such as input/output connectivity and specialty engine, provide room for further enhancements to the company's overall operations in the long term, he said.

The new system will also allow the MEPS to develop new product features, as well as improve the organization's processing capability--and hence, capacity--to accommodate accelerated growth in transactions, he added.

"Over the last three years, MEPS IBG experienced a compounded growth rate of 52 percent. And as of December 2008, over 36 million transactions worth approximately 90 billion ringgit (US$24.6 billion) were processed," Mohd Hata revealed.

"The MEPS is a strong supporter of the government's national agenda to migrate from paper-based payment to electronic payment. With more organizations and government agencies pushing and promoting e-payments, MEPS IBG volume is expected to continue to grow aggressively," he said.

IBM's Malaysia managing director, Ou Shian Waei, said in a statement: "With energy costs rising and power density of new electronics increasing, power-efficient devices are increasing in importance for companies like the MEPS. We provided the relevant value propositions that have real short-term and long-term impact on the MEPS's business."

Lee Min Keong is a freelance IT writer based in Malaysia.

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