An organization formed by eight of the world's largest banks has emerged from its chrysalis to become a separate company, Identrus, which will work to facilitate interoperability between the banks' Internet systems.
The organization was originally founded by banks from the United States and Europe, including Bank of America, ABN AMRO, Bankers Trust, Barclays Bank, Chase Manhattan, CitiBank, Deutsche Bank, and Hypo Vereinsbank.
Now, through Identrus, each bank will create and issue digital certificates for its customers, which they can then use in order to be authenticated by other member banks. The digital certificate technology already has the support of certificate vendors Certco, Entrust Technologies, and ValiCert, according to the companies.
"It's trying to solve the problem of banks being able to facilitate one public key certificate being recognized by another bank," said Brian O'Higgins, chief technical officer of Entrust, in Richardson, Texas. "It's to facilitate PKI [public key infrastructure]-based electronic commerce between like-minded institutions. It's an initiative that is a good thing for anybody using PKI."
Using Identrus-approved digital certificates, customers will eventually be able to easily transfer money, conduct business-to-business commerce, and perform other financial functions over the Internet. However, this particular system may be attractive only to the banks and may not translate to other industries, according to analysts.
"What they are doing is putting in place a back-end trading network among themselves," said Jim Hurley, managing director of the Aberdeen Group Inc., an analyst company in Boston. "I see this as something that will well serve the back-end trading of financial banking networks; I don't see it as something that brokers and traders will participate in."
Currently, Canadian Imperial Bank of Commerce and Sanwa Bank are in negotiations to become members of the financial institution, according to Identrus.