Bangalore: Software majors Infosys and Wipro, who are vying with each other for global IT outsourcing contracts, have now joined hands to outsmart competitors and win domestic banking contracts.

The Bangalore-based firms have bagged a Rs 90 crore core banking solution deal from public sector Vijaya Bank, in which Wipro will work on end-to-end implementation and integration of Infosys's Finacle banking solution, besides providing telebanking and anti-money laundering solutions.

"We compete in the morning and network in the afternoon," Wipro chairman Azim Premji said of rival Infosys, with whom it has already implemented core-banking projects with Union Bank of India and Oriental Bank of Commerce.

Vijaya Bank is the third customer for whom the two IT firms are jointly implementing a core-banking solution in the country and expect to continue the relationship both at home and abroad.

"We are very fierce competitors and do it in a humble way; we do it in an ethical way and we are proud of it," Infosys chief mentor N R Narayana Murthy said, adding that he used Wipro's computer and lighting products at his office.

Premji, however said there are markets like Africa where Infosys operates and where joining hands is difficult and ruled out partnerships in the Business Process Outsourcing (BPO) space between Wipro Spectramind and Progeon, the BPO unit of Infosys.

Vijaya Bank chairman and managing director M S Kapur said the core-banking solution for 350 branches in 18 months would be extended to other branches by retaining the IT majors as implementation partners.

Premji ruled out Wipro's foray into building banking products, saying the IT major would instead prefer to provide system integration over Finacle and other banking products.

Kapur said the bank would have to redeploy about 30 per cent to 35 per cent of the staff with the implementation of the core banking solution, whom it would train and deploy in marketing and other allied activities.

He said the bank would make an additional Rs 100 crore on IT infrastructure over the next two years.

Murthy declined to comment on the Rupee appreciation and also avoided talking about the controversial Indian Institutes of Management (IIM) fee cut issue.

Premji said Wipro would design Vijaya Bank's IT infrastructure, data centre, disaster recovery centre and the help desk, besides managing the IT infrastructure for an extended period.

He said banks in the next few years will increasingly resemble an electronic network requiring considerable IT investments and this might result in banks sharing common IT infrastructure in the form of data centres and ATM network.

However, Premji cautioned that bank managements must clearly distinguish from layering technology over existing processes and using IT for strategic differentiation.

"While automation of business processes is key, what is important is to integrate technology in core business areas to create a competitive positioning," he said.