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What is a good overview regarding the benefits of electronic signature technology as it applies to the financial industry? Based on proven and validated ROIs, the key benefits reported by financial institutions are the significant reduction in life cycle cost of managing mission critical documents, accelerating turnaround time of account applications, increasing revenue by having more time available for up/cross selling, providing access to electronic content immediately and significantly reducing back office costs. It’s all about enhancing the customer experience whether it is face to face, through a call center or via the Web and reducing expenses. What have been the primarily applications and specific benefits thus far? Account openings, loan applications, and mortgage process are the leading applications, due to the benefits associated with retail bank branches, such as eliminating 150 paper forms and reducing courier costs by 90%, and an insurance application involving thousand of sales personnel signing up customers in 1/3 rd the time with a 92% customer acceptance rating with the application and process. Internet and typical Teller Station applications aimed at increasing transaction security while reducing fraud is increasingly becoming a priority. What role did/does legislation play in the adoption of electronic signatures in the financial industry? The E-Sign Law that passed in 2000 was a key driver giving electronic signatures the same legal standing as traditional wet ink signatures on paper, thus reducing the risk of using the technology. The state laws, or Uniform Electronic Transaction Act (UETA), industry specific laws and regulations like the Graham Leach Bliley Act (GLBA) and the Patriot Act have further addressed critical industry issues that can affect the use of this technology. Industry standards groups like MISMO, SPERS, and NAVA have also made significant strides in establishing standards for how the technology can interoperate within the these complex and heavily regulated markets. Tell me about CIC’s electronic signature products and what differentiates your offering? CIC’s hosted and enterprise infrastructure software solutions provide a common framework that delivers legally binding and compliant electronic signatures regardless of the specific business process being automated, type of documents being signed, or method of signature required. CIC delivers an industry best practice process for any method of electronic signature input for any popular file format, such as Adobe, Word , HTML, or custom applications and is capable of interfacing with most mainstream point of service hardware such as signature pads, tablet PCs, fingerprint readers, touch screens, voice, PKI signature from a specialty device or smart cards. What specifically do you mean regardless of type of signature method? The Federal E-Sign Law is technology neutral, so we have developed a solution that can accommodate virtually any signature method of input including a live biometric handwritten signature, voice recording, fingerprint, signature stamp, PKI, password for Click2Sign and interface to identity management and access control systems. Working with leading early adopter enterprises, banks, insurance companies and brokerage firms, we learned that each signature method has its own risk management and cost benefits. We learned that the speed at which electronic signature solutions can be deployed together with the optimum risk management process is critical to maximizing the ROI of any business process solution. Can you give us a brief history of your electronic signature deployments? As a pioneer in electronic signature solutions, our first major deployment dates back to 1995. This deployment involved handwritten biometric signature verification and digital certificates to authenticate authorized personnel for the loan pooling and transfer of home mortgages through what now is JP Morgan Chase to Ginnie Mae involving billions of dollars. Over the past several years, we have emerged as the leading supplier of electronic signature solutions to the financial industry including deployments at AIG, Charles Schwab, Prudential, Nationwide (UK), Snap-on Credit, State Farm and Wells Fargo. We have well over 400 installations worldwide, at various levels of deployment, many at the pilot and proof of concept stage, however the large scale deployments at the leading financial industry enterprises are the source of valuable experience and know-how. How does CIC’s electronic signature solution provide a legally compliant signature and process? A legal electronic signature must serve as a “symbol of intent”, be “unique to the signer” and “under the signer’s sole control.” Our signing “Ceremony”, a patented approach designed to engage the user in entering pertinent information along with the user’s signature (handwritten, voice, click2sign, etc.) that develops a “stream of consciousness” between the signatory, document and desktop collecting all pertinent data that fully describes the signing event and comprises irrefutable “proof of intent.” All of this information is bound to a transaction or document using industry standard cryptography to make the records “tamper evident”. This “Ceremony” data includes the who, what, when, where and why information leaving an audit trail and evidence needed to resolve disputes and non repudiation issues in front of a judge. How does CIC electronic signature technology protect and provide security for this process? The electronic signature is captured and bound to the document using a cryptographic hashing algorithm approved by NIST. This algorithm is used to create a one-time key based on the data in the document, the signatory information and the signature itself. The signature information and key are encrypted using standard security techniques to prevent tempering. As a result, the signature can only be validated within the original document to which it is bound. Any, and all, selected electronic signature methods of signing are included in this patented process and methodology that delivers, through simple and intuitive interaction, a legally binding and regulatory compliant document. Haven’t paper based process been one of the key focal points for digitization within the financial industry? With increasing worldwide competitive pressure, most financial enterprises are focused on streamlining processes and reducing operating costs. Due to the cost of paper processing, advances in Internet technology and the passage of supportive legislation for electronic transactions, historical paper-based processes are one of the key focal points for digitization. Although many have adopted electronic processes to collect data for filling out forms, they still find themselves printing the documents to collect a signature from the executing party. At which point, the paper document has to go back through the original back-end process of being shipped to a processing center, scanned into the imaging system, and even shipped to a warehouse for storage. For most companies, only the lowest risk processes are performed in a purely electronic manner and in the end, do not result in the kind of ROI expected from most document automation projects. How well has electronic signature been adopted in the financial industry? Adoption has been slower than expected especially considering the significant benefits. There are several reasons for this. The use of Public Key Infrastructure (PKI) only solutions has been the source of significant expense, technical complexities and management concerns inhibiting the adoption of electronic signature solutions. Digital signatures (PKI) provide a "security" component and electronic signatures provide the "practical" component. The increasing awareness that electronic signature technology replaces paper based process with the highest level of efficiency, cost reduction and non-repudiation is now accelerating adoption of our technology. Early on, no vendors offered complete electronic signature solutions and early adopters had to design their own total solution and integrate the components themselves. Deployment of an electronic signature based solution in a large financial institution has been a relatively long process. It’s not the electronic signature portion that is slow, it is the natural process of solution design, development, testing, pilot, implementation and training. Historically, this is always the case with automation of existing processes. We made major contributions to those early adopters and benefit from the knowledge gained and positive references. The electronic signature deployments achieved by the early adopters are now providing the proven ROI and motivation for other financial institutions to pursue the proven benefits of electronic signature processes and motivating large enterprise software solutions providers to address more complete and higher level enterprise solutions utilizing our electronic signature software components in the same way the end users are. Clearly, the low level of financial services IT spending, following the passage of the E-Sign Law in late 2000, was an inhibiter. According to Tower Group reports and other studies, IT spending, which was 8.5% during the Internet Boom, dove to an average 1.9% beginning in 2000 through 2003. 2004 and 2005 averaged 3.9%. Based on your pioneering experience, what problems or practices would you advise financial institutions to avoid? The most effective, high impact, rapid ROI and efficient deployments result when electronic signature technology is given consideration upfront along with the overall process automation/workflow enterprise-wide plan. Single point specific solutions implemented without being part of a corporate level/CIO driven electronic signature based process automation plan can create major problems in wasted time, expense and adoption potential. Hardware can cost two to five times more than electronic signature software costs per seat or point of capture/input. We can, and do, interface with virtually any legacy hardware, however, it has become apparent that, if possible, Enterprise infrastructure level software decisions should be made before any hardware is purchased or deployed. |
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