Web Banking via Cell Phone, Palm Catching On

Beginning next year Bank of America Corp. will allow its 30 million [M] customers to do their banking over the Web via wireless devices such as cell phones and 3Com Corp.'s Palm computing device, the bank announced today.

Bank of America, which is the largest in the U.S., will base its system on software from Toronto-based 724 Solutions Inc. The software is also used by about 500 customers of Bank of Montreal who are participating in a wireless Web banking trial somewhat similar to Bank of America's planned service. Meanwhile, Barclay's Bank in the U.K. and DeCoMo, a subsidiary of Nippon Telegraph & Telephone Corp., is using the 724 Solutions software to allow its customers to do Web banking over their cell phones.

Judging from the experience at Bank of Montreal, customers are attracted to the freedom of banking from anywhere and not just from a PC. When the bank asked for volunteers for the trial, more than 100,000 customers applied, according to Rick Kuwayti, spokesman for Bank of Montreal.

The wireless banking system, called Veev, has several advantages over traditional phone banking, which is based on a step-by-step voice response system. "Veev turns your phone into an actual Internet-device," said Kuwayti.

The phone screen functions as a PC screen for navigation and display of information. Using a Palm device connected to the phone gives a larger screen and the possibility for using the Palm's screen keyboard. Thirty percent of the customers involved in the trial use the Palm devices, according to the bank.

Users can customize the service. For instance, they can make it so the phone rings when a particular stock moves a certain percentage, Kuwayti said. The bank expects to offer stock trading in mid-2000.

A participant in the Bank of Montreal trial said being able to do banking on a portable device enables her to act quickly. "You have no more excuses for being late," said Robin Stephens, a doctorate student at Toronto Hospital who uses Veev for checking bank balances and transferring funds.

"But there is some room for improvement," Stephens added.

The problem is the lack of keyboard which forces people to using the phone's keys to type in letters and that is cumbersome. "When you are in a hurry and have to press three times in order to get a C" it is frustrating, Stephens said.

The potential number of customers for Web-based services is growing fast. According to market researcher International Data Corp., based in Framingham, 12.2 million [M] non-PC Internet access devices will be sold next year, nearly matching the sale of personal computers. Another research company, Jupiter Communications Inc., based in New York, predicts, that more than 10 million [M] mobile phones will be capable of accessing Internet-based data by 2002.

The founder of 724 Solutions, Greg Wolfond, also founded Footprint Software Inc., which develops object-oriented financial techniques. When IBM bought Footprint in May 1995 for an undisclosed sum, Footprint's sales were at US$100 million [M], having grown from $4 million [M] in five years.

Wolfond stayed on managing Footprint and focusing on IBM's network computing technology for the financial services and securities industries. He left Footprint in 1997 to start 724 Solutions. Wolfond also owns Blue Sky Capital Corp. and a major part of Baystone Capital Corp.

724 Solutions' software resides on the server that serves as the "middleman" between the user's device and the bank's system, using standard industry and financial interface protocols. The software recognizes the type of device calling in and adapts the navigation and the banking data to the screen, whether it be a six-line or 12-line display on a cell phone, or a Palm screen which also can receive graphics, according to Alistair Rennie, senior vice president of marketing at 724 Solutions.

This strategy eliminates the need for the bank to change its IT infrastructure for every new type of device. Also, the customer's special set up is registered at the server level, eliminating the need for customization for every type of device customers may use. In addition, the server monitors stock quotes, news and other services for the user, Rennie added.

The access device itself needs special software. Cell phone manufacturers include a micro browser on new digital cell phones, while users of Palm devices have to install an application, according to Rennie.

The software includes security functions based on the Secure Socket Layer (SSL) standard developed by Netscape Communications Corp. If stronger security is needed, 724 Solutions uses special encryption software from a partner.

The cell phones represent a challenge when it comes to user friendliness. "We try to keep the need for keystrokes down to an absolute minimum," said Rennie. Bills, for example, are presented in a format that enables easy scrolling for viewing them, she said.

John Torkos, another Bank of Montreal customer who also uses his PC heavily to bank online, is happy to have the Palm screen at his disposal. "I can't stand the lines in the banks, also I travel a lot," said Torkos, a network communication analyst at Sterling Commerce Inc.

But Torkos points out one disadvantage with the Veev system. "I pay by the minute on the cell phone, and this can be very expensive," he said, adding that the Bank of Montreal and its partner Bell Mobility should reduce the cost by giving a discount.

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