Market Scan

Worth A Look: New Approach to Strong Authentication

For the complete press release, click here.  Key points:

"With Keystone Authentication, images are used to create one-time passwords (OTP) that provide a simple, intuitive method for authenticating bank communication channels. Keystone Authentication provides token-equivalent security for a fraction of the cost for deployment and maintenance. The solution offers secure access and network validation from any computer or IP-networked ATM around the world, using a simple decoding device that can be conveniently stored in a mobile phone, PDA, or wallet.

The integration of Cronto Visual Signing solution with the Keystone Authentication engine enables a level of security beyond one-time passwords for website authentication and payment transactions. Cronto’s technology allows all important actions, such as authentication to online services or payment/beneficiary authorization, to be signed off by the users in an extremely intuitive and reliable way."

BancorpSouth Offers Mobile Banking

According to an article in Bank Systems & Technology (click here), BancorpSouth, a $13 billion bank based in Tupolo Mississippi, has offered mobile banking since March 2007.  BancorpSouth's mobile banking service is powered by Firethorne.

According to Michael Lindsey, SVP of electronic delivery services, "we got customers used to this early on. So our next concern with regard to mobile banking was how to get the [mobile phone] carriers involved," he says. "So we approached Firethorn [Atlanta]. Firethorn used a federated strategy in which it partnered with the carriers."

Lindsey continues, "This shows that you don't have to be a megabank to be the first out of the gate and to have the partnerships with major players."

FRB Dallas on Remittances to Mexico

FRB Dallas is puzzled at the increase in remittance to Mexico since 2000:

"What's driving the rapid growth of remittances to Mexico? It's a question that has puzzled researchers for years because the most likely economic forces don't seem to be in play. Fundamental factors, such as the size of the Mexican migrant population, their income and the strength of their bonds to Mexico, haven't grown as fast as remittances. Other variables, such as the peso–dollar exchange rate and Mexican economic conditions, have been relatively stable since at least 1996.

What have changed are money-transfer costs, which have plummeted since 2000 (emphasis added), and Banco de México's measurement techniques. Together, these factors likely account for the bulk of unexplained remittance growth in the last few years."

For the full report, click here.

Commentary

Hmmm...this time frame roughly coincides with Wal-Mart's formal entry into the money services business, when the company formed an alliance with Moneygram and slashed the cost of wire transfers.  Coincidence?   Not likely.  This year, Wal-Mart is formerly launching its in-store money service counters, which should drive more volume its way.  Thus far, Wal-Mart's entry into money services has been a big winner for consumers, both foreign and domestic, which in the past have relied on high cost channels like check cashing vendors and grocery stores. 

Wells Fargo Experiences Broad System Outage

From the Tuesday Aug 21 Wells Fargo press release:

"We restored Internet banking service in about one hour and 40 minutes Sunday, Aug. 19, and within hours, customers could access Wells Fargo Phone Bank Centers and make basic ATM transactions, such as withdrawing cash and making deposits at our ATMs but not at non-Wells Fargo ATMs. All point-of sales transactions, processing for mortgage, home equity, student loans, ACH, wire transfers and remittances, are now up and running."

Commentary

The last sentence is an indication of the wide breadth of the outage, which occurred Sunday afternoon and may have been the result of a system upgrade.

Wachovia Introduces Weekly Economic Outlook Podcast

Wachovia will provide weekly economic outlook forecasts via pod casts available on its website.  For the press release, click here.  For the latest pod cast, click here.

JPMorgan Chase, Cardtronics, and Walgreens Ink Texas ATM Pact

JPMorgan Chase will put its logo on 423 ATMs located in Texas Walgreen's and operated by Cardtronics:

• Houston, 212 ATMs
• Dallas, 87 ATMs
• San Antonio, 49 ATMs
• Austin, 34 ATMs
• El Paso, 22 ATMs
• Rio Grande Valley, 11 ATMs
• Corpus Christi, 8 ATMs

For the full press release, click here.

The Next Generation of Remote Deposit Capture

Ed McLaughlin, Executive Director at RemoteDepositCapture.com, speculates on the future of remote deposit capture:

"The ability to include access to these other (payment) applications is leading to a next generation, a 3rd generation, of Remote Deposit Capture in the market, one which will use portal technology, and where access to other enterprise applications and all payment types will be managed from a single screen. The advantage of portals is that they integrate different applications and business processes in a single UI that can be personalized by user yet still maintain totally different back office services."

Commentary

If your bank is planning its next remote deposit capture release, this article is worth a read.  You can find it here.

Fifth Third to Acquire First Charter

Fifth Third Bancorp and First Charter Corporation have signed a definitive agreement under which Fifth Third will acquire Charlotte-based First Charter, which operates 57 branches in North Carolina and 2 in suburban Atlanta.  For the full press release, click here.

Commentary

Perhaps the new bank will be named Fifth Third First!  I crack myself up!

Comodo Introduces Out-of-Band One Time Passwords for Strong Authentication

Comodo, a provider of certificate-based solutions for two-factor authentication, has introduced an out-of-band one time password solution for two-factor authentication.

"Through the introduction of one-time passwords designed for use at public computers, Comodo TF is now as effective as token solutions for user authentication at remote locations but do not include the high cost or challenging customer deployment typically associated with these types of solutions.

These one-time passwords can be delivered through a variety of customer-selected options such as SMS messaging, email or telephone. The key benefit to end users is "anywhere, anytime" access to online banking accounts allowing optimum flexibility."

See related post from August 12, More Riders Jump on the Mobile Payments Bandwagon.

Commentary

Software certificate-based solutions for multi-factor authentication have been overshadowed by tokens here in the United States, at least for banking applications.  They tend to create customer support headaches and often don't save much money over physical tokens.

With out-of-band one time passwords, the unfortunately named Comodo may be onto something.  As indicated in my August 12 post, these could be a considerable improvement over physical tokens, at least from a customer service standpoint.

WASAU Adds Remote Lockbox Capability to its Remote Deposit Capture Solution

WASAU Financial Services has released a new version of its remote deposit capture solutions which "includes new options for remote wholesale lockbox processing, with enhanced Optical Character Recognition (OCR) technology, featuring full-page document scanning capabilities for invoices and customer correspondence that may accompany a customer payments."  For the full press release, click here.  In another press release, WASAU claims to have been chosen to replace incumbent remote deposit capture systems at 5 of the top 50 U.S. banks.

Commentary

WASAU Financial Services has a strong remote capture product and the company seems to have a good handle on the needs of banks.  The inclusion of remote lockbox capability is a natural for WASAU, as lockbox processing systems are a core comptency for the company.  Lockbox capability represents the next logical step in corporate remote deposit capture systems and could be a boon to community and regional banks that need to provide a wholesale remittance option in local markets, but cannot justify the investment in a local lockbox operation.

Banks that are seeking an all-inclusive remote capture option should give WASAU a look, especially if they also need an image-enabled remittance processing.