„RSA Mobile authentication software provides an order-of-magnitude advance in delivering increased assurance of an Internet user‚s identity in an easy to use form,‰ said Graham Titterington, senior analyst at Ovum. „It is anticipated that it will be popular with both end users and organizations providing services over the Internet.‰
There are a limited number of areas where significant growth in demand over the next several years will create the potential for substantial revenue; the payment business is one. Banks should view the aggressive moves by new entrants and nonbanks as evidence that they are missing opportunities and that their core business is under threat. Eight years after Furash published our study, it appears that some of the more dire predictions are coming true.
The big benefit of this "switch" for the merchant acquirer is that, in the same way he can connect up to one merchant through this switch, he can connect up to any of the others. For the merchant looking to connect to another merchant acquirer, the switching costs of replacing protocols and leased lines have suddenly vanished. As a merchant, you can go to anyone of your suppliers and say "Ho ho, things have changed. Instead of it taking me three months to swap you out for another guy, it's only going to take me three minutes." The pricing power goes to the merchant now. That's the type of thing that happens with Web services, and when you put things through an intermediary who can connect you to anyone of those suppliers. We do this in the area of payment and I can't give you additional product plans, but there are lots of opportunities for the same type of service in Web services.When we built Visa's Acquirer Services (now Vital Processing Services - a joint venture between Visa USA and TSYS) back in the mid-80's, one of the selling points to merchants (mentioned very quietly!) was that a merchant could connect directly to Visa technically and then broker their business relationship among acquiring banks essentially at will. Of course, merchants directly connected to First Data Merchant Services can do almost the same thing today because of FDMS' multiple alliance bank partners.
UCAF is a 32-byte field with a variable data structure that is useful to support any number of authentication approaches to cardholder identities, including: MasterCard's Secure Payment Application (SPA), biometrics, digital certificates, smart cards and even mobile and pervasive devices support. MasterCard's UCAF infrastructure allows customer data to be transported between participating merchants, acquirers and issuers through a series of hidden fields. It offers an extra level of protection by allowing customers to type in personal identification numbers along with their credit card numbers and other personal information when buying goods online.
Why is electronic bill payment becoming a mantra for so many businesses? Some of course hope to save on postage and other administrative costs. But it also reflects how badly companies want to hang onto customers right now. They know that once a customer has gone through all the trouble of setting up electronic bill payment, he or she is less likely to switch loyalties -- 80% less likely in the banking industry, according to Bank of America. "It drives profitability," says John Rosenfeld, e-commerce executive there.According to the article, Bank of America, Chase and Citibank are now offering free online bill payment to many of their customers. I just checked Wells Fargo and it looks like they're now also offering free online bill payment if you maintain $5,000 in your account.
PayPal, as an online payment system, is a natural target for fraud. And Levchin has almost singlehandedly saved the company from thieves bent on exploiting the system, says Avivah Litan, a vice president and analyst covering financial services at Stamford, Conn.-based Gartner. "If they didn't have Max, they might have succumbed, because PayPal was susceptible to fraud and money laundering, and Max tightened them up," Litan says.
For security, all MSN Wallet payment and address information is electronically encrypted and stored in a database on servers that are located in access-controlled facilities. Many other safeguards further enhance security, including comprehensive data filtering before it enters the system and an industry-standard encryption method (triple DES) that is designed to help prevent anyone but the intended retailer from decoding and reading transmitted information. Microsoft also announced that it plans to discontinue a separate shopping service, called Passport Express Purchase, to focus Passport on its core mission: to enable a robust, online authentication platform.Separately, Joe Wilcox reports on CNET that Microsoft has begun notifying Passport users of changes that would give them more control over their accounts and increased privacy and security.
The first change only affects new account holders, who will no longer be able use a bogus e-mail address to establish a Passport. Microsoft requires consumers to use an e-mail address as their Passport ID, but had not mandated that the address be legitimate or belong to the account holder. ... The second change could bolster Passport security. Microsoft is moving all the information viewed in a Web browser, such as the login page or member services, to servers hosted in a domain separate from the authentication components. That information would come from passport.net rather than passport.com. The two-domain mechanism also will eliminate the long, hard-to-decipher URL the user sees in the browser's Web address bar.
"Credit is boring. It's yesterday's news," says Carl Pascarella, chief executive of Visa USA. "Our goal now is to displace cash and checks. We're not a credit card company, we're an electronic-payment company."