Bank of America backs mFoundry
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added Bank of America (BoA) to its already impressive list of
strategic partners. BoA joins existing strategic investors
Motorola, PayPal, and NCR Corporation, and venture capital firms
GRP Partners, Ignition Partners and Apax Partners.
customers now and into the future,” said BoA e-commerce and ATM
head Lance Drummond. “This investment further solidifies the
importance of having a strong mobile technology platform.”
banking customers and over 100,000 users daily on peak usage
days.
its mobile payments technology Citibank and BB&T, the 14th
largest financial-holding company in the US.
ONLINE PAYMENTS
Happy birthday PayPal
On 23 June PayPal celebrated its 10th anniversary. It was a 10-year
period that saw the number of people connected to the internet soar
from 150 million to 1.4 billion and the number of active PayPal
accounts rise from 1 million in 2000 to 60 million at
present.
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By GlobalDatapeople to do something that few ever dreamed possible 10 years ago
– send and receive money all around the world through the click of
a button,” said PayPal president Scott Thompson.
processing $2,000 in payments every second, an amount equal to 9
percent of the world’s total internet-based commerce.
survey on US internet usage conducted for it by Ipsos Research.
Among notable findings was that 84 percent of respondents have been
shopping online for five or more years, and 87 percent report they
shop online at least once per month. Travel goods and services were
the most widely purchased items (82 percent of respondents).
MOBILE BANKING
Canadagoes mobile
Canada is about to join the fast-growing number of countries to
embrace mobile phone banking. This comes thanks to an agreement
between mobile banking service provider Monitise Americas and a
Canadian electronic transaction switching service provider Everlink
aimed at delivering the country’s first commercially available
mobile banking and payments service.
agreement. Everlink is a joint venture founded in 2003 by US
banking and payments technology vendor Metavante and Celero
Solutions, a provider of technology services to Canadian credit
unions.
founded in 2007 by Metavante and UK mobile payments technology
developer Monitise. Celero and Everlink will provide access to its
client base of 375 credit unions and an undisclosed number of
banks. Everlink processes 500 million transactions annually.
SECURITY
High praise for 41st Parameter
Founded just over four years ago by American Express’ former
worldwide fraud director Ori Eisen, US venture capital backed 41st
Parameter lays claim to “revolutionising the way businesses think
about and employ effective internet security”. Adding weight to its
claim is the decision by the world’s fifth largest airline
Continental Airlines to entrust to it card-not-present fraud
detection.
for a specialised fraud detection and prevention solution, we found
41st Parameter has proprietary technologies not available from
their competitors,” explained Continental Airlines cash &
investments treasury unit MD Tom Ferazzi. “We believe these
capabilities will allow us to capture more fraud faster than any of
the alternatives we reviewed.”
FraudNet online retail solution, has more than 2,900 daily
departures and carries about 69 million passengers annually.
MOBILE PAYMENTS
Upaid recharges Brazil
With a well-established presence in Brazil, UK mobile payments
specialist Upaid Systems has launched RechargeBrazil, a service
that extends its reach to Brazilian’s living in the US.
offered in conjunction with PayPal and enables Brazilian’s in the
US to send mobile phone credits to Brazil by entering the mobile
service operator, location and telephone number of the recipient.
The service covers Brazilian mobile operators Vivo, Claro, TIM,
Telefonica, and Embratel.
nearly 2 million transactions monthly.
PAYMENTS PROCESSING
Visa Europe to migrate to BT network
In a move designed to greatly enhance payment processing efficiency
Visa Europe is to migrate its transaction network spanning 36
countries onto UK telecommunications company BT Group’s (BT)
internet protocol based 21st Century Global Network (21CN). The
five-year managed services contract between Visa and BT builds on
processing technology development relationship that has existed for
seven years.
21CN will improve operations through the use of a single supplier
and a flexible network making further upgrades and developments far
simpler than previously possible. Conceived in 2004 21CN has been
gradually replacing BT’s first generation internet service since
November 2006.
350 million Visa debit, credit and commercial cards in circulation.
In the 12 months ending December 2007, Visa card purchases and cash
withdrawals totalled €1.3 trillion ($2.1 trillion) or 11.4 percent
of consumer spending at POS in Europe.
SECURITY
UK security companies talk up alliance
Two UK online security companies 3rd Man and 192.com Business
Services (192) have formed an alliance they believe will provide “a
unique anti-fraud service to merchants”.
The alliance combines the two companies’
specific areas of expertise. 3rd Man provides screening services
which detect fraud patterns by comparing transactions from
different merchants while 192 specialises in aggregating databases
against which electronic commerce providers run customer identity
checks. 192’s aggregated databases comprise over a billion
records.
192 director Ian Green said data sharing on
its own is not a “silver bullet.” However, he added that when data
sharing is coupled with customer identity verification it becomes
an “immensely effective” solution.
“E-commerce and online gambling sites now need
to integrate only one fraud prevention tool into their site so this
is a massive step forward for the industry,” concluded Green.
COMPANIES
More backing for Inside Contactless
Korean conglomerate Samsung has become Inside Contactless’ latest
investor in an extension of the French contactless payment
technology developer’s series C funding round in which it has now
raised a total of $42 million. Samsung, via its venture capital
unit Samsung Ventures America (SVA), joins an impressive investor
line-up that includes Nokia Growth Partners and Motorola
Ventures.
“The participation of the top three global
handset manufacturers in this round of funding is a ringing
endorsement of Inside’s leadership in the emerging near field
communication [NFC] market,” said Inside Contactless CEO Rémy de
Tonnac.
“As the NFC market progresses, we are hopeful
these partnerships will prove invaluable in propelling us forward
to power the NFC revolution and extend our leadership.”
SVA MD Brian Kang said: “We are optimistic
about NFC technology’s ability to bring exciting new payment and
other applications to mobile handsets, and Inside’s leadership in
moving this market forward is impressive.
“Our investment expresses our confidence in
Inside’s ability to continue its success not only in the
contactless payment market but also in the emerging NFC technology
for mobile phones.”
PAYMENTS PROCESSING
Clear2Pay delivers SEPA solution to PBS
Pengeinstitutternes BetalingsSystemer (PBS), Denmark’s electronic
payments processor, has announced its single Euro payment area
(SEPA) direct debit processing service is operational. Implemented
by Belgian payment processing technology vendor Clear2Pay, 117
financial institutions have already signed up for the service, a
total representing about 80 percent of the Danish Bankers
Association’s membership.
PBS CEO Flemming Jensen said: “After a careful
selection process we opted for Clear2Pay’s SEPA solution because it
offers both the future proven technology we were looking for as
well as the functionality we need to process credit transfers and
direct debits for debtor and creditor banks and corporate creditors
in a multi-bank, multi-currency environment.”
According to Clear2Pay the solution
implemented for PBS can be easily extended to accommodate SEPA
Credit Transfers.
CONTACTLESS PAYMENTS
Gemalto and Pegasus consolidate ties
Pegasus group, an alliance of seven major French banks and four
mobile phone service operators, have extended Netherlands payments
technology vendor Gemalto’s contract as supplier of independent
intermediation services to their Payez Mobile contactless payments
trial until the end of 2008.
Launched in November 2007 with 1,000 users and
200 merchants in Caen and Strasbourg, the Payez Mobile trial using
mobile phones equipped to undertake contactless payments is proving
successful and, according to Gemalto, studies by the Pegasus group
revealed a satisfaction rate of over 90 percent. Users appreciated
the all-in-one approach and ease of use and merchants the benefits
of shorter payment waiting times in particular.
Gemalto also noted that five banks in the
trial are using its Allynis data exchange system which links the
banks and mobile service providers. The banks are BNP Paribas,
Crédit Agricole-LCL, Crédit Mutuel-CIC, Caisse d’Epargne and La
Banque Postale.
INTERNET BANKING
Korea smoothes the path for competition
Korea’s Financial Services Commission (FSC) has announced that it
is to amend regulations to enable internet-only banks to be
established in the country. The FSC said amendments, which could
include the easing of equity capital requirements, would encourage
financial services companies to enter the internet banking
market.
The FSC’s desire to increase competition in
the financial services industry has already elicited a positive
response. Notably, in a release following the FSC’s announcement
the state-owned Korea Development Bank (KDB) said it is “gearing
up” to establish an internet bank. The KDB added that a similar
move is being planned by another Korean bank, the Hyundai Swiss
Savings Bank.
Revision of the FSC’s internet banking
regulation is the subject of examination by a special task force.
Finanlisation is scheduled for the end of 2008.
INTERNET BANKING
Better deal for New Zealand consumers
The New Zealand Bankers Association has bowed to strong pressure to
amend the internet banking section incorporated for the first time
last year in its Code of Banking Practice.
Amendments follow consultation with the
Internet Society of New Zealand and advocacy group Consumer NZ.
The three key amendments to the code regarding
internet banking are:
1. The current practice of banks reimbursing genuine victims of
internet banking fraud is affirmed and is stated as a guiding
principle,
2. The reference in the 2007 code to banks reserving the right to
request access to verify protective systems has been removed,
and
3. The requirement that customers accessing their accounts via the
internet, have up to date security systems on their computer has
been amended to ‘reasonably up to date’.
INDUSTRY TRENDS
Solid incentives from Bank Negara
Malaysia’s central bank, Bank Negara has taken steps aimed at
promoting the use of electronic payments and reducing the cost of
doing business in the country.
In its first move Bank Negara has reduced the
transaction fee for payments made by banks on behalf of their
customers using RENTAS, its real time gross settlement system.
With effect from 15 July this year the
transaction fee imposed on banks for third party payments was
reduced by 40 percent, from RM2.50 ($0.77) to RM1.50. In tandem
with this there was a corresponding reduction of RM1.00 in bank
charges imposed by banks on their customers for RENTAS
payments.
In its second move Bank Negara announced that
the banking industry would review changing its current 0.03 percent
inland exchange commission to a fixed fee. This said the central
bank should result in a reduction in bank customers’ transaction
fees on funds transferred between different states in
Malaysia.
MERGERS AND ACQUISITIONS
Ingenico looks east for growth
Despite China having 1.5 million POS terminals installed density
per million inhabitants is a mere 880, or about 5 percent of the
density in Western European markets. It makes China an attractive
market and one French electronic payment terminal vendor Ingenico
intends to pursue with vigour.
Furthering its ambitions in China Ingenico has
announced the purchase of a 55 percent stake in Chinese POS
manufacturer Landi Commercial Equipment Company for $17.05 million,
a development Ingenico said gives it the largest share in the
country’s POS market.
“This acquisition is a significant step in our
strategy to enter high-growth markets,” said Ingenico CEO Philippe
Lazare. “Our combined product ranges will target both Chinese and
North Eastern Asian markets, such as Korea.”
Established in 1992 Landi reported total
revenue of about €18 million ($28 million) in 2007.
INTERNET BANKING
Citibank leads the pack
Citibank has regained its status as the best US internet bank in
the latest Keynote Banker Scorecard, an analysis conducted
biannually over the past 10 years by internet and mobile research
firm Keynote Systems. Citibank together with 25 of its peers was
assessed on more than 200 criteria in nine categories designed to
measure each website’s design and function against industry best
practices.
Out of a potential maximum score of 100 points
Citibank scored 87 points, as well as achieving the first or second
place in the nine categories. The categories include transactions,
account opening, looking up information, functionality, ease of
use, privacy and security and quality and availability. In
addition, for the first time in its analysis Keynote included the
availability of mobile banking and how banks offer it.
In gaining overall top position in Keynote’s
analysis Citibank narrowly beat Bank of America into second place
(85 points). They were followed by Wells Fargo (82 points), Chase
(81 points) and Wachovia and Washington Mutual (77 points
each).
The overall average score of bank websites
assessed was 70.6 with the lowest scores achieved by TD Banknorth
(51 points), Sovereign (51 points) and Regions, HSBC and First
Tennessee Bank (55 points each).
ONLINE PAYMENTS
Yodlee talks up online billpay solution
With US consumers feeling the economic pinch the temptation to pay
bills at the last possible moment is growing. For banks this
represents an opportunity to generate increased revenue services
and one online banking systems vendor Yodlee has strenuously
highlighted with the launch of its expedited bill payment solution,
Yodlee PayToday.
Over 35 percent of US consumers use online
expedited payments today while 75 percent of the top 50 US banks
are offering or planning to offer expedited payments noted Yodlee,
citing studies by research firms Edgar Dunn & Co and Aite
Group, respectively.
“We think the data is very convincing, leaving
little doubt that there is growing consumer demand for expedited
payments, in particular through the online channel,” said Yodlee
senior vice-president Joseph Polverari.
“Yodlee is able to deliver hundreds of
well-known national and regional billers, so a typical consumer
could expect to be able to pay four or more monthly bills on an
expedited basis,” continued Polverari. “This translates into a very
big revenue opportunity for financial institutions. We are not
aware of any provider, other than Yodlee, that can deliver as rich
an assortment of relevant billers across all of the major biller
categories.”
PAYMENT PROCESSING
Clear2Pay and Experian team up for SEPA
Belgian payment processing technology vendor Clear2Pay and US risk
management specialist Experian have established a partnership which
they believe will enable them to seize opportunities set to flow
from the Single Euro Payments Area (SEPA).
The partnership will see Experian’s bank
account and validation software Bank Wizard embedded in Clear2Pay’s
Open Payment Framework (OPF), an end-to-end payment processing
system used by European banks in 44 countries.
Bank Wizard is designed specifically to
undertake bank account validation for banks and corporates
operating internationally and minimises errors by enabling users to
check the validity of bank details before a payment is sent to a
clearing house or another bank. The partners stressed that SEPA
requirements such as direct credit and direct debit are reinforcing
the importance of validation as a core part of banking in
Europe.
Clear2Pay vice-president of strategy and
marketing Mark Hartley said: “Experian Payments is a market leader
when it comes to data validation and our partnership will enable us
to offer customers the industry’s most sophisticated bank account
validation tool as part of our end-to-end payments offering.”
TRANSACTION PROCESSING
MasterCard adds e-invoicing
Atlas Air Worldwide (AAW), operator of the world’s largest fleet of
Boeing 747 freighter aircraft, has become the first company to
integrate electronic invoice capabilities with MasterCard’s
commercial payments processing platform Payment Gateway. Launched
in October 2007 Payment Gateway facilitates the routing of payments
between buyers, suppliers and their financial institutions.
For invoicing AAW has selected iPayables, a US
electronic invoice specialist that manages invoices for over 800
customers and 30,000 suppliers from 150 countries and processes
invoices worth $800 million per month. According to MasterCard
iPayables is the first non-bank reseller whose functionality has
been coupled with its Payment Gateway creating what it termed “an
end-to-end solution that offers companies a more streamlined,
faster and secure way to make payments”.
PREPAID CARDS
South African first for Absa and Visa
South African bank ABSA and Visa have joined forces to launch the
country’s first re-loadable prepaid card. Targeting the unbanked
and consumers seeking an alternative to other payment-forms such as
cheques, the cards are available for a one-time fee of ZAR30
($4.50), are valid for three years and carry no management
fees.
Other features of the card include free
purchase transactions at POS, one free balance enquiry and cash
withdrawal per month and free airtime top-ups. In addition the card
has no minimum balance and can be topped up by transferring funds
via mobile or online banking or from any ATM.
“Our presence in Africa and the partnership
with Visa provides an opportunity for the prepaid concept to take
root across the continent and reach new marketplaces,” said ABSA
head of retail banking Venete Klein.
ABSA is a unit of UK bank Barclays.
COMPANIES
Banco do Brasil selects Fiserv for US
startup
Brazilian bank Banco do Brasil (BdB) has announced it is to expand
its operations in the US with the establishment of a new unit,
Federal Savings Bank (FSB), which will focus on Brazilian
immigrants in the US. For this development BdB has selected US
financial technology vendor Fiserv as its key partner.
Five FSB branches are to be established in
quick succession and will involve deployment of the Premier core
banking system from Fiserv’s Information Technology, Inc (ITI)
unit. Fiserv will also supply other solutions including electronic
funds transfer for ATM and debit cards, credit processing and risk
management. In addition ITI will provide FSB with outsourced
processing services.
“Opening five branches nearly simultaneously
is not a typical situation,” said BdB deputy general manager
Leonard Whyte. “We obviously need state-of-the-art solutions which
is why we selected Fiserv solutions.”
Whyte continued that BdB had found “large
pockets” of Brazilian immigrants throughout the US who are
inadequately served mostly because they are primarily Portuguese
speaking.
“This market is an obvious niche for the bank,
and we chose Fiserv and ITI because they have a strong reputation
for supporting clients serving niche markets,” said Whyte.
SECURITY
Stepping up the war on cybercrime
Google, eBay and PayPal have teamed up to provide consumers more
effective protection against fraudulent e-mails and phishing
attacks.
Available to users of Google’s Gmail email
service protection is provided by DomainKeys and DomainKeys
Identified Mail (DKIM) email authentication technology that enables
Google to identify and intercept fake e-mails claiming to be sent
by eBay and PayPal.
“The Gmail team’s decision to work with eBay
and PayPal on this issue is a significant step forward in our fight
to keep consumers safe from phishing and cybercrime,” said PayPal
chief information security officer Michael Barrett.
“Today’s announcement will enhance online
safety for millions of eBay and PayPal customers who use
Gmail.”
In essence, DomainKeys and DKIM use
cryptography to verify the domain of the sender. This enables email
service providers to validate an email’s originating domain, making
use of blacklists (emails that it won’t deliver) and whitelists
(emails that it will deliver) more effective.
PREPAID CARDS
Prepaid industry prepares to police itself
In a move aimed at improving consumer confidence in prepaid
products trade association the Prepaid International Forum (PIF)
has launched an accreditation scheme which it said is designed to
ensure “industry best practice”.
Established in June 2007 the PIF is an
international body now boasting a 44 members that include American
Express, GE Money, JPMorgan, MasterCard, Transport for London and
Western Union.
The PIF explained that the accreditation
scheme has come as result of demand from its members.
The members, added the PIF, are determined to
establish best practice standards and are sensitive to the concerns
expressed in recent adverse media coverage about prepaid such as
alleged money laundering, aggressive marketing and poor customer
service.
Members complying with the PIF’s standards
will be licenced to use a PIF accreditation symbol on marketing
materials. The PIF will carry out an annual audit of accredited
programmes.
Commenting, the PIF’s chairman Chris Reddish
said accreditation represents a “significant step forward” for the
prepaid industry.
“As the demand for prepaid services gathers
pace, it is essential that the industry takes the lead in
establishing and policing the levels of service necessary to
underpin consumer confidence and the continued growth of prepaid,”
Reddish added.
SECURITY
HSBC’s lucky break
What could have been the perfect crime has been foiled, landing the
perpetrator, UK bank clerk Jagmeet Channa, in jail for nine
years.
At the heart of Channa’s attempt to steal £70
million ($140 million) from HSBC, was a plot involving a breach of
the bank’s security that almost succeeded but for a minor error on
his part.
To facilitate the crime Channa had stolen
passwords from colleagues at HSBC’s head office in London. Armed
with the required passwords he used them to transfer €90 million
from an HSBC account, €30 million of which he sent to an account in
Manchester and €60 million to an account in Morocco.
His only error was that the HSBC account was
left with a huge debit, a discrepancy noticed and reported by
vigilant HSBC staff in Malaysia.
Sentencing Channa, Judge Geoffrey Rivlin said:
“This was a carefully planned and very serious attempt to transfer
a fortune in money away, and it almost succeeded.”
BIOMETRICS
Equens trials pay by fingerprint
The Netherlands’ first trial of biometric finger print
identification in the POS environment has been launched in a joint
initiative between payments processor Equens and supermarket
company Albert Heijn.
The trial dubbed Tip2Pay utilises technology
developed by German biometrics specialist IT-Werke that scans and
verifies a customer’s identity by comparing 24 unique points on the
surface a finger.
IT-Werke’s biometric solution, which is
branded digiProof, has already been deployed on a permanent basis
by a number of German retailers including supermarket chain Edeka
that now offers fingertip payment services at 120 of its
stores.
Another German user is Gewandhaus Gruber a
fashion retailer with 10 stores that utilises the IT-Werke solution
in its loyalty card programme.
According to IT-Werke retailers using the
system report a 25 percent share of payment transactions via
digiPROOF after six months. In addition, digiPROOF customers have
been found to shop more frequently and have an increased basket
size, noted IT-Werke.
MOBILEPAYMENTS
Parkby SMS in Belgium
Pursuing its strategy of expansion in the mobile payments sector
Belgian telecommunications company Belgacom has acquired
Mobile-for, a specialist in mobile payments for parking
services.
Established in June 2006 by Apcoa Belgium, an
Antwerp parking operator, and NOW! Innovations, an Estonian digital
permit and mobile payments specialist, Mobile-for’s service is
based on a short message service (SMS) payment solution developed
by NOW! Innovations and implemented in cooperation with Belgacom’s
mobile phone service unit Proximus.
To use the service a motorist sends an SMS
containing the code of the parking zone and the vehicle’s licence
plate number to a dedicated four digit service number.
Vehicle details are verified by an attendant
equipped with a handheld online device. When the parking session is
complete the motorist sends a single letter Q to the service number
and is billed only for the time the vehicle was parked.
First launched in Antwerp in September 2006
the Mobile-for service now accounts for 30 percent of parking fees
in the city. The service is now available in seven Belgian cities
and will be extended to a total of 10 by the end of 2008.
MOBILEBANKING
ANZ brings mobile banking to Vietnam
Australia and New Zealand Banking Group (ANZ) which in 1993 became
the first foreign bank to commence operations in Vietnam has added
a new first: Vietnam’s first mobile banking service.
Launched on 10 July the free service is
initially available in Ho Chi Minh City and Hanoi, cities with a
combined population of 10 million.
ANZ’s decision to go the mobile banking route
comes at a time when Vietnam’s mobile phone industry is booming.
According to Vietnam’s Ministry of Information and Communications
the number of new mobile phone subscribers reached 48.9 million at
the end of the first quarter of 2008, up 23 percent compared with
the end of last year.
Announcement of ANZ’s mobile banking service
coincided with the announcement that it had been granted a full
banking licence by the State Bank of Vietnam. ANZ currently
operates
