Is That My Account Number on Your
Sticky Note?

Bottomline Staff Conducts Field Experiment

Initiating a wire transfer. Seems like a typical bank function if there ever was one. So typical, in fact, that not much about the process has changed since the 19th century. Granted today we have phones, faxes and computers, but just as it was 125 years ago, verbal exchange with a teller remains central to the process.

In most banking environments, it is a common and accepted practice to verbally communicate details such as account numbers and personal identification information to complete a wire transfer. Also consider that most bank employees tend to write this information down on scraps of paper or sticky notes to be eventually discarded, and suddenly you're faced with a risk management nightmare.

Our "Customer Experience" Experiment
To demonstrate just how large of a potential problem this can be, Bottomline conducted a field exercise recently to test the process at four New England banks (one large national, one large regional and two local banks). What we found was near universal reliance on verbal communication to initiate a wire. One such instance was even conducted entirely via speakerphone! And that's not all, at two of the banks, computer screens, which displayed information such as a mother's maiden name, were in clear view of bystanders. In all cases, the process was time-consuming and settlement not always quick.

While this exercise was just a sampling of the customer experience, it is indicative of a larger situation that has caught the attention of the Fed, who with increasingly regularity goes on alert for process loopholes that may expose banks and clients to fraud.

The Story of Fifth Third
Recently, Fifth Third Bancorp turned to Bottomline after it was informed by the Fed that the bank needed to address risk management concerns related to wire transfers in order to complete a proposed acquisition. In the case of Fifth Third, verbal communication of client PIN numbers was deemed to be an open invitation for fraud. The mere fact that a third party could overhear an account number as it was spoken into a telephone receiver was enough for the Fed to raise a red flag.

Since deploying the WebSeries® Real Time Gross Settlement (RTGS) module earlier this year, Fifth Third is now able to complete the wire initiation process from end-to-end via a Web-based application. No more verbal PINs over the phone. No more exchanging wire instructions aloud. No more exposing the bank to unnecessary risk. Today, the entire process is handled quickly and securely with a few clicks of a mouse.

But the benefits of automation didn't stop with risk mitigation. Automating the initiation process has removed several steps from the old process, which has allowed employees to be more productive and allocate their time more effectively. Conversely, the speedier process has benefited clients as well and provided Fifth Third with a new differentiating factor in an already competitive marketplace.

If you would like to learn more about how Fifth Third addressed its wire initiation process, read their story featured in the March edition of Bank Technology News.

For more information on Bottomline's branch automation solutions click here.