Digital Insight is expanding its long-standing banking technology partnership with Milwaukee-based Metavante, the banking and payments technology subsidiary of Marshall & Ilsley Corp. (Milwaukee), to include the real-time payments technology of NYCE Network, a U.S. debit card payments network and a Metavante division. The NYCE Network technology will enable Digital Insight to offer secure account-to-account (A2A) transfer capabilities to its bank customers.
The NYCE-enabled functionality expands Digital Insight's (Calabasas, Calif.) payments capabilities and provides online banking users with faster and more-flexible fund transfers and person-to-person payment options, the company said in a release. Each transfer uses only the recipient's ATM/debit card number rather than also requiring the recipient's PIN or expiration date to assure security.
This expanded partnership is indicative of Digital Insight's recognition that a big part of a bank's value is in its billpay services, according to Alenka Grealish, manager of Celent's (Boston) banking group. But those services cost the bank money, and Digital Insight needs to find a way to extract value for its bank customers, she adds.
"This is one additional value add-on," Grealish continues. "It lets [Digital Insight's] customers know that, 'We are on top of offering numerous ways to transfer funds.'"
Further, real-time A2A transfers are a valuable capability that can help position a bank as the primary financial transaction hub for customers seeking the added convenience and flexibility of making instant electronic transfers and payments, according to Grealish. "More important," she adds, "banks believe that if they have a user-friendly online product, they will encourage users to raise balances." Grealish contends that banks have found that with A2A, more money flows in than out.
"It's a very important ability for an institution to have," agrees Jeff Stiefler, Digital Insight chairman, president and CEO. Banks want to be the one place to which their customers come to move money, he suggests. A2A capabilities create just one more reason for an end user to come back to the institution, Stiefler explains.
"The primary advantage is that it facilitates cash management for the consumer, expedites account openings and more-readily diversifies financial holdings," adds Celent's Grealish.
What sets the Digital Insight-Metavante solution apart from most other A2A solutions is that it provides the functionality of ATM transactions and enables transfers to occur during the day, not just overnight as with ACH (automated clearing house) transactions. It "rides on ATM rails rather than ACH rails," Grealish explains, referring to the payments infrastructure on which the capability operates.