Smartcard home banking may be on way to UK
© 1999 ZDNet UK

French company ActiveCard is supplying home-banking hardware to French banks, and UK talks are underway

British Internet users may soon be turning their computers into highly secure online banking consoles, according to smartcard manufacturer ActiveCard, which has just sealed a deal to supply French banks with its smartcard technology.

ActiveCard, itself a French company, has agreed to supply French banking consortium Cyber-COMM with technology that will allow bank users to plug portable card readers into any personal computer in order to access their bank accounts via the Internet and verify online transactions more securely.

ActiveCard technology enables a smartcard to generate its own encrypted password via a tiny CPU residing within the card's onboard chip. The consoles will work with existing Visa and MasterCard compliant chip-based banking cards.

According to Fredric Engels, marketing director of ActiveCard, British consumers could soon be enjoying similar luxuries. "We are in talks with British banks although I can't reveal the details," he says. "The general manager of Cyber-COMM is also head of FinRead [a pan European body that researches the use of financial technology] so hopefully ActiveCard technology will become a European standard."

Engels also promises that European consumers will soon see dramatic developments in the area of mobile banking adding, "GSM [Global System for Mobile Communications] is the next step in this area. ActiveCard technology can already be used with GSM technology and WAP [Wireless Application Protocol] is also becoming a very interesting area."

Smart Card specialist with computer security software firm Entegrity Solutions Andy Clark highlights just how much more secure a smartcard is than a good old-fashioned password. "If a smart card is implemented properly and the cryptographic generator on the card itself, then it is considered much more secure than an encrypted password. On a basic level it is much easier to subvert a piece of software on your computer that generates an encrypted message than to manufacture a card that does the same thing."

A spokesperson for the Association for Payment of Credit Services (ASPC) in Britain says that the introduction of portable bankcard readers for personal computers would certainly be a step in the right direction as far as British banking is concerned. "This would certainly provide peace of mind for users and for retailers. We have been saying for a long time that we are in favour of technology that makes it easier to verify that you and your credit card are where you're supposed to be."

D K Matai, director of London based computer security firm mi2g, says that even though smart cards may significantly enhance the security of online banking and transactions, the future of this sort area of e-commerce is likely to be biometrics. "The moment you bring in a physical authentication tool security is significantly increased," he says.

"We think biometric [technologies] will be much more secure and are the future, but in the short term smartcards may help increase confidence and benefit e-commerce."