Credit Union tech-talk News

August 20 - August 24, 2007

• General News
• Hardware News
• Software Updates
• ATMs/Kiosks
• Biometric Digest Highlights
• Wireless World
• Security Section
• Leaders Roundtable
• Technology and Marketing
• Online Banking/E-Commerce/
  Website Design
• Internet Access
• Call Centers
• Conferences

* Western Federal Credit Union Selects Symitar
* Arcot Updates WebFort
* Summit Expands Canadian Operations
* Credit Union 24 Shows Membership & Transaction Increases

Jack Henry & Associates, a leading provider of integrated technology solutions and data processing services for financial institutions, announced that California-based Western Federal Credit Union has selected the Episys platform to provide enterprise-wide automation. This credit union, which has more than $1.2 billion in assets and approximately 119,000 members, will install Episys in-house. With a merger pending between Western and Toyota FCU, currently a Symitar client, Episys will be the system for the merged entity. 

Arcot Systems, a leading provider of secure e-payment and authentication solutions, has updated its software-based two-factor authentication system, WebFort, with a Flash-based client for easier installation and use of PKI-based authentication. ArcotID and the WebFort system enable online user identification and authentication, digital signing, and secure eStatement delivery. 

Summit Information Systems, a business unit of Fiserv, and provider of advanced technology solutions to Canadian and U.S. credit unions, announced that they have hired Glenn Schaffrick as regional sales manager for Summit Information Systems Canada. Schaffrick, a veteran of the Canadian financial services sales industry, will sell the iSpectrum banking platform for Canadian credit unions and other Fiserv products.

Credit Union 24, the nation's only credit union-owned point of sale (POS) network, announced that they have seen record numbers of new credit union network participants join the EFT cooperative, while transaction volumes from credit union cardholders have also increased. Credit Union 24 has signed 15 new credit unions to the network so far this year, and has seen transaction volumes increase by more than 16 percent over the same period last year.

Hardware News

CTS North America has introduced a high-speed color check and document processing scanner dubbed the LS800. The check and document scanner/sorter processes up to 212 dpm (documents per minute) in either black & white or color mode. The LS800 meets all Check21 requirements and features a front and back imaging camera, a 500 document feeder capacity and intelligent multi-bin sorting capabilities. 

Corsair, a provider of computer and flash memory products, has launched the “Flash Padlock” family of affordable USB 2.0 drives starting at $29.99. The drives address the need for secure data storage through hardware technology, rather than software. Flash Padlock features “Auto-Locking,” so the user doesn’t need to remember to enable the protective feature because it will automatically lock and protect itself after removal from the computer. Flash Padlock can be unlocked via a touch-pad security PIN entry system.

MagTek®’s ExpressCard 1000 is the industry’s first “ALL-IN-ONE” instant issuance and complete card personalization platform forCredit, Debit, ATM, and Financial Gift Cards designed to fit securely and comfortably within a branch location.

For the first time, card personalization features such as color card-printing, magstripe encoding, smartcard encoding, card embossing, indent printing, and foil tipping have been combined into a single device which provides both the physical and logical security features required to meet the demands of a branch or retailer’s card issuing environment.

Equipped with MagnePrint® card authentication technology (www.magneprint.com), the ExpressCard 1000 offers the capability to capture the card's reference MagnePrint at the time of card issuance so that reference value may be used in conjunction with complementary risk management analytics with card present transactions. The ExpressCard 1000 can be connected as a peripheral to MagTek’s IntelliCAT and MCAPS 3000 PIN selection and instant issuance software suites creating a complete and secure card issuing platform.

For more information on ExpressCard 1000, go to www.magtek.com or call your MagTek sales representative at 800-788-6835.

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ATMs/Kiosks

Envelope free ATM deposits are gradually gaining traction. According to Dove Consulting, 21 percent of banks and 24 percent of credit unions deployed deposit-imaging ATMs in 2006. Another 58 percent of banks and 65 percent of credit unions said they planned to deploy the technology at the ATM within the next year. The big three ATM manufacturers - NCR, Diebold and Wincor Nixdorf - are all promoting their machines' capabilities, and NCR alone has deployed more than 2,200 intelligent-deposit ATMs capable of accepting check and cash envelope-free deposits in the United States. Some experts are even predicting that by 2011, about one-third of all American ATMs will accept automated deposits for cash and check. 

Since partnering with 7-Eleven in November 2005, CO-OP Financial Services, which operates CO-OP Network and its 25,000 surcharge-free ATMs, has saved credit union members with cards carrying the CO-OP Network logo nearly $50 million in surcharges at 7-Eleven ATMs. Transactions at the 5,500 7-Eleven locations nationwide have increased to two million per-month, and the CO-OP Network expects the number of transactions to keep rising following the introduction of surcharge-free deposit-taking capabilities at the machines. 

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If your credit union uses a Citrix Gateway, you may want to look into securing remote access with a new small biometric device. Learn more about it in the September issue of Credit Union tech-talk - subscribe today.

Colorado Springs-based Ent Federal Credit Union will celebrate the grand opening of its Jackson Creek Service Center. The new 4,000 square-foot service center features three drive-through lanes, 24/7 ATMs with cash and check imaging capabilities, and biometric accessed safe deposit boxes.

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The 3G wireless card vendors (e.g., Novatel Wireless and Sierra Wireless) are targeting both laptop makers and users who want to connect via USB devices. Currently only about 10% of enterprise laptops have embedded 3G cards, so some organizations are looking closely at USB devices for remote access and disaster recovery purposes. Of course, embedding the access device makes it difficult to lose, break, or get stolen, but USB devices have advantages as well by offering a level of portability and flexibility attractive to end users. It works well in a modem pools where a few 3G devices are shared among a larger group. Plus they offer organizations the flexibility to upgrade their hardware as carriers rev their access technology to even faster speeds every year. 

Meanwhile, Sprint's ambitious WiMax service, providing speeds up to four times that of 3G (somewhere in the range of 2Mbps to 4Mbps), has a name: "Xohm" (pronounced ZOAM). The Xohm WiMAX network will be open access, meaning that all WiMAX-certified devices will be able to operate on the network. Devices will not be required to have an additional carrier certification, as is true with traditional cellular networks today. Sprint will build about 65 percent of the network, and Clearwire the remaining 35 percent. The Xohm service is scheduled to launch in Chicago and the Baltimore/Washington DC area by year-end and other commercial markets will be launched by mid-2008.

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Security vendor RSA is reporting an increase in the amount of free 'man-in-the-middle' phishing kits - designed to subvert two-factor authentication controls - circulating around the Internet. The free kits are usually primed to send stolen user credentials to both the instigator of the fraud and the creator of the software. According to the RSA Anti-Fraud Command Center report, credit unions were the most frequently targeted financial institutions in the U.S. by online scammers during July. 

With its ThreatWall 450 Web Security Gateway, eSoft aims to make allowing employees to surf the Internet a safer proposition. The ThreatWall combines anti-virus, anti-spyware and anti-spam capabilities into a single appliance. It scans common Web protocols for malware, provides URL filtering, and can allow or disallow IM and P2P traffic. The ThreatWall 450 costs $3,299 plus $999 for a one-year subscription. 

Many credit unions will turn to security consultants to help them protect their data, but it is important to be well prepared before the consultants actually arrive to do their work. We will give you some tips for working with security consultants in the September issue of Credit Union tech-talk - subscribe now.

MAGENSA™ is a trusted verification authority (TVA) that provides real-time remote-hosted credential authentication services. These services enable credit unions, financial institutions, businesses, and government agencies to integrate PCI DSS and FFIEC multi-factor authentication and end-to-end data encryption capabilities into their existing processing environments without the need for substantial financial investments or massive changes to the existing infrastructure.

Specifically tailored to enhance the security of internet banking and ATM applications, MAGENSA delivers unprecedented security and authentication using the familiar magstripe card credentials (secure tokens) that a credit union has already issued to its members. MAGENSA is powered by the trusted and proven card authentication technology known as MagnePrint® (www.magneprint.com). MagnePrint differentiates a members’ authentic magstripe card from an altered or counterfeit version, transforming the traditional magstripe card into a powerful security token.

MAGENSA’s Secure Data Center (SDC), a reliable 24x7 operations center that is maintained 365 days a year, simplifies the integration of data decryption and MagnePrint scoring into existing websites, and allows for data federation across institutional domains.

For more information on MAGENSA, please visit www.magensa.net or call 877.MAGENSA.

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Online Banking: 

Embraced by Members - The Next Steps

Digital Resolve - http://www.digital-resolve.net Read Dennis Maicon's comments: http://www.cunews.com/roundtable/DigitalResolve.pdf

GalaxyPlus - http://www.galaxyplus.com   Read Jay Slavin's comments:     http://www.cunews.com/roundtable/GalaxyPlus.pdf

Harland Financial Solutions - http://www.harlandfinancialsolutions.com   Read Niles Bay's comments:   http://www.cunews.com/roundtable/HFS.pdf

Microsoft - http://www.microsoft.com Read Greg Haislip's comments: http://www.cunews.com/roundtable/Microsoft.pdf

Open Solutions - http://www.opensolutions.com   Read Michael D. Nicastro's comments: http://www.cunews.com/roundtable/OSI.pdf

uMonitor - http://www.towergroup.com   Read George Tubin's comments:   http://www.cunews.com/roundtable/TowerGroup.pdf

uMonitor - http://www.umonitor.com   Read Dinesh Sheth's comments:   http://www.cunews.com/roundtable/uMonitor.pdf

USERS - http://www.users.com   Read Eric Panepinto's comments:   http://www.cunews.com/roundtable/USERS.pdf

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Javelin Strategy & Research has come out with a new survey that surprisingly shows that Generation Y (consumers ages 18 to 29) is not ready to abandon the brick-and mortar, or other channels, to go completely online or to the handset for all their banking needs. For example, when selecting a new financial services provider, Gen Y consumers ranked access to ATMs and access to branches as more important than online service capabilities, in comparison to those of other age groups. In the last 12 months 80% of older Gen Y used an ATM for either a deposit or withdrawal, 59% used an automated telephone system to perform a banking transaction, and 90% visited a branch, demonstrating an apparent demand for multi-channel availability. 

Sacramento-based SAFE Credit Union has come out with a unique product that will allow members to tie their auto loan to their home mortgage, enabling them to deduct interest on their auto loan from their taxes. The product is called the Auto Equity Loan, and home owning members are not required to have their mortgage through the credit union. 

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There were a couple of vendor announcements this week that affect online banking. First, Comodo announced a series of product enhancements to their TwoFactor solution. Key features of this new release include: 1) generation and acceptance of one time passwords when the member is at a remote location; 2) a choice of delivery vehicles of the one-time password that the user selects, including SMS/phone or email delivery; and 3) enhanced administrative tools. Second, Yodlee and Andera announced a strategic alliance that calls for Andera to be the exclusive provider of account opening technology to Yodlee, and Yodlee to be the exclusive provider of account verification and funds transfer technology to Andera. 

Online Banking Report's latest issue titled "The Market for Fraud Protection, Identity Theft, and Credit Monitoring Services" recommends that "the time is right for all financial institutions to add identity protection/monitoring to their online offerings. The service has been optimized for Web delivery; it provides clear user benefits; it’s relatively easy to implement, and it can directly contribute to the bottom line in real, fee-based dollars, not nebulous intangibles.”

Eastern Corporate Federal Credit Union announced it is piloting a new Consumer Deposit Capture program, which allows members and small business members to electronically scan checks and send them to their credit unions for collection. Any member who is pre-qualified, and has access to online banking and a home desktop scanner can use the new service. The Consumer Deposit Capture program is being piloted by Hanscom Federal Credit Union and Digital Federal Credit Union.

Revolutionary Convergence of Security Technology for Secure Internet Banking!

MagneSafe^TM P55 is a portable card reader/authenticator with four key technologies for secure online banking: Cardholder Data Encryption, MagnePrint^® card authentication technology, Website Authentication and Track 1, 2 and 3 card reading capabilities. In conjunction with MagneSafe^TM, the MagneSafe P55 is designed to offer secure, multifactor authentication for Internet banking, empowering consumers with the freedom and confidence of knowing that their transactions are protected anytime, anywhere.

MAGENSA, a Trusted Verification Authority that provides real-time, remote-hosted credential authentication services, allows credit unions to integrate PCI DSS and FFIEC compliant multifactor authentication, data encryption, website authentication, and data federation capabilities without the need for substantial financial investments or massive changes to the existing infrastructure.

For more information about the MagneSafe P55 or MAGENSA, visit www.magensa.net, or call 877.MAGENSA.  

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NEC Unified Solutions has launched UC for Business (UCB), an enterprise-wide UC solution that merges contact center functionality with unified messaging, mobility and desktop telephony applications. NEC says that their UCB solution can help small organizations improve their communications through a customizable desktop application that integrates with Microsoft Outlook. With UCB’s Outlook option, users see a unified inbox for all landline and cellular calls, voice messages, e-mails, faxes, chats, and other communications directly through their Outlook client. Users can also establish an auto-attendant to identify incoming calls and provide preset, customized information or call routing to streamline communications. 

It can be painfully slow to move large files over a WAN (wide area network). One option is to deploy a WAFS (wide area file system) solution that minimizes the delays by using a shrewd combination of more efficient transport protocols and intelligent data mirroring. However these types of hardware solutions can be expensive. A more affordable alternative is to use a software package like RocketStream's application suite. The suite is founded on RocketStream's proprietary PDP (Parallel Delivery Protocol), which harvests the best characteristics of TCP and UDP and adds features such as on-the-fly data encryption and compression. RocketStream claims its suite provides better than 100 times the performance of FTP, and costs between $20 and $10,000 per year, depending on the bandwidth and the complexity of the installation.

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As more and more members choose the online channel and soon the mobile channel, some experts believe that the call center is only going to grow in importance. That is because the call center is where members turn to when questions or problems arise. TowerGroup estimates that transaction volumes at financial institution call centers are expected to grow relatively modestly: 7.1% annually over the next four years. That compares to a 27.2% annual growth in online transactions, 1.4% for branch transactions and 0.5% in ATM transactions. However, the complexity of the calls will increase and the research firm recommends investing in staff performance optimization, desktop integration and VoIP (voice over Internet protocol) systems.

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Catch Tom and Bill Rogers, Associate Editor of Credit Union tech-talk at the following conferences in 2007:

August 9-10, Pasadena - Financial Technology Solutions International Technology Forum

October 10-13, Albuquerque - Firefighters' National Credit Union Summit

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