Susan Foulds of Watchfire GomezPro comments on recent launches of inter-institutional transfers by Citibank and Bank of America.

IITs are defined as fund transfers among accounts held by the same customer at two different institutions. That could mean a lot of things, but here we will focus on the recent trend at Citibank and Bank of America: IITs as ACH transfers among deposit and possibly investment accounts.

Susanna Schwartz writes in Billing World about Simpay, the European mobile commerce consortium.

The design of the payment platform is nearly complete, and expected to officially launch by Q2 2005. The vendors involved are Valista, Encorus, Privnet and Qpass, which are working with the founding operators to enhance specs.

The Simpay hub has recently been outsourced to Encorus, a mobile payments services company—majority owned by First Data Corp.—which will continue the development of Simpay's transaction processor. The acceptance testing will be conducted by Encorus in upcoming months. Simpay has built a test script and simulator hub, which transmits messages among members. It also has completed various business schemes, operating regulations and governing documentation.

The federal bank and thrift regulatory agencies have announced final rules to require financial institutions to adopt measures for properly disposing of consumer information derived from credit reports.

Current law requires financial institutions to protect customer information by implementing information security programs. The final rules require institutions to make modest adjustments to their information security programs to include measures for the proper disposal of consumer information. They also add a new definition of "consumer information."

The final rules take effect on July 1, 2005. The full text is available online for downloading (PDF).

Computer Sciences Corp. (CSC) has announced the results of a performance and scalability benchmark test of is CAMS II card and merchant system. CSC's five-month testing project demonstrated that the strategic in-house card management platform can process a simulated workload of 100 million active cardholder accounts.

"Most U.S. credit card processing is outsourced to third parties who achieve scale economies through product standardization," said Theodore Iacobuzio, vice president of research at TowerGroup, a leading financial services research and advisory firm. "An in-house alternative would contribute to a sea change by enabling more flexible credit-card processing at scale, under the issuers' direct control."

AMR Research has published an alert on contactless payments.

Conclusion: Despite the promise, no new payment system gains hold rapidly.  There’s too much inertia in the system from consumer education, to POS infrastructure, to payment devices in consumers’ hands.  Retailers should carefully watch the success of CVS and merchants accepting MasterCard’s PayPass.  Retailers should resist jumping in until they feel there are a reasonable number of RF-enabled cards or keyfobs in circulation in their geography.