Smart Card Adds Security to Cash Management Service
Ferris, Tom, American Banker
NEW YORK -- Corporate financial officers are increasingly using desktop computers to initiate wire transfers and gather financial data from their banks. Now the Royal Bank of Canada is introducing what it considers to be a better way to prevent misuse of those office computers: "smart cards."
The smart card looks like a credit card but derives its name from an added feature -- an embedded microprocessor, or chip, that gives it computing power and the capability of storing large amounts of information.
The smart card, which was invented in France, is usually associated with consumer-oriented services both inside and outside of banking. Visa U.S.A. and MasterCard International, the two major bank-card organizations, are planning to use smart cards as a way to improve security and provide more varied services.
Royal Bank, Canada's largest, says it is one of the first banks to apply the smart card to a wholesales service.
The ability of corporations to hook into their banks' computer systems via microcomputers has provided great benefits for treasurers, but at the same time has presented them with significant security concerns, said Norman Achen, a senior vice president of the commercial banking division of the bank.
Treasurers are worried about outsiders gaining access to the system and about employees overstepping their authority, he said. …