A deck of 28 different secure ID cards–that's what one treasurer pulled out of his top desk drawer during a 2005 visit by Paul Galant, managing director and global head of Citigroup's cash management business. "There has to be a better way of providing secure identification," he complained to Galant. It turned out that he was talking to the right person. Galant was also tired of coping with things like Citi's vast files of paper signature cards. It was time to find a better way.
Today, one year after his fateful visit, Galant and Citi think they have come up with a solution that will let that treasurer dump his cards in the trash in the not-too-distant future. After testing the technology at a large pharmaceutical company and in various Citi departments, the global bank is about to go public with a state-of the-art digital system, called simply Citibank Identity Management. The new tool will use third-party technology and standards instead of bank proprietary formats.
Initial applications, which Galant expects to link with
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Citi's TreasuryVision global cash management tool, will secure transactions between corporate treasuries and their banks. Eventually, however, Citi aims to extend the identity management technology to transactions between corporations and their supply chain partners, Galant says.
To build the tool, Citi went to established tech companies like IdenTrust, based in San Francisco. Although the new tool involves old technologies like digital certificates and digital signatures, it combines them in different ways, Galant says, to make the end product more convenient and less costly. Currently, the bank is testing its experiment with six customers.
Even before Citi set out to develop the ultimate tool, the bank was linking its own systems to IdenTrust's multibank platforms and focusing on corporate uses. Now, Citi is taking digital identification to "a new level," says Karen J. Wendel, CEO of IdenTrust, which was started seven years ago by a group of large banks and recapitalized with venture capital money a year ago. "They have a big lead on other banks, which are offering silo solutions that only work with their banks."
John Sculley, the former CEO of Apple Computer Inc. and PepsiCo Inc., is now a venture capitalist and nonexecutive chairman of IdenTrust's board. Citi's efforts are "part of an important trend toward interoperable banks systems," Sculley says.
The streamlined solution would come, for clients, with a Citi guarantee. "If companies follow the rules, we will guarantee the identities of the participants and stand behind those guarantees," Galant notes. "A little tech company doesn't have the balance sheet to put much weight behind such guarantees. That's not true for a big bank."
Galant expects the new solution to reduce Citi's liability, not expand it, by embedding responsibility in a set of business rules. The catch for customers: Enhanced security and control only come to those who comply. Others may find their risks are actually higher.
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