Vasco Optimistic About RBI OTP Guidelines

Two-factor authentication provider Vasco Data Security has said that the recent guidelines by the Reserve Bank of India (RBI) that mandates all merchants in India to collect an OTP (One Time Password) in addition to information written on the credit cards for all transactions done over phone (IVR) is a welcome policy move and would boost the security of online and offline banking transactions.  As per the new policy, Indian banks are required to provide OTP directly to their customers for a secure transaction over IVR. This can be done either through the card user's registered mobile number or email ID or both.   “This will require Indian banks to invest in a technology platform that integrates various communication channels like phone, email, SMS, Web and fax with the CRM and database applications. Now, with passwords being generated and sent for individual customers on request, a detailed and granular customer profile can be maintained and fetched whenever required. With a mandate of OTP added to other financial transactions-related regulations, merchants of e-commerce enabled businesses, banks and other financial institutions are facing a challenge of ensuring compliance. Both generation and distribution of the OTP requires a tight interoperability among the various underlying business applications,” said Jan Valcke, Vasco’s President and COO.   “With a user base of over two million consumers in financial services in India; Vasco is the largest authentication partner to Indian Banks. DIGIPASS for Mobile is our authentication solution which uses the capabilities of Internet enabled mobile phones for authentication purposes. Most phones also employ phone applications for using IVR which enables customers to access their bank using a touchtone telephone or voice recognition,” he added.   According to Vasco, India has 27 public sector banks, seven new private sector banks, 15 old private sector banks, 31 foreign banks, 86 regional rural banks, four local area banks, 1,721 urban cooperative banks, 31 state cooperative banks and 371 district central cooperative banks.  “Mobile phone users are becoming less hesitant towards the adoption of mobile applications as the security of these devices is enhanced. While RBI has taken a step in the right direction by mandating additional password, it is the authentication strategy adopted by banks which is of great importance. It should be based on enhancing security and providing convenience to the banking consumer,” he averred.