The banking technology provider Fidelity National Information Services Inc. is planning to offer mobile banking services to its core processing clients, through a deal announced last week with mFoundry Inc.
Drew Sievers, mFoundry’s chief executive, said this is the biggest deal to date for the Sausalito, Calif., mobile banking software vendor.
“They’ve got somewhere around 9,000 financial institutions, and obviously they’re a key partner for us,” Mr. Sievers said.
mFoundry has five other partnership deals, including one with First Data Corp., and Mr. Sievers said he is pursuing agreements with other technology companies that can deliver a large number of bank users, as well as deals with individual banks. “We are looking basically to get our platform adopted by people who have a lot of exposure,” Mr. Sievers said.
mFoundry has been working with Fidelity National for the past month to install its software. “We need to make sure that our systems, our software, are in place in their data centers,” he said. When the technical integration is complete, the companies plan to start pitching the service to Fidelity’s clients.
Anthony Jabbour, the executive vice president of core products for Fidelity National’s integrated financial solutions group, said Fidelity National is already discussing the mFoundry software with clients, but is holding off on signing contracts with them until the first quarter. He expects to have the software running at some clients in the second quarter.
Mr. Jabbour said his company chose to work with mFoundry because “we were impressed with the capabilities that they had.”
In particular, he said, “we wanted an application resident on the mobile device.” Many other providers use mobile Web browsers or text messages to provide banking services.
Though Fidelity is not opposed to working with other vendors, and indeed expects to do so if its clients sign with other mobile vendors, “we’re doing fewer partnerships, per se, but trying to make them deeper,” Mr. Jabbour said.
He also said that the mFoundry mobile banking software can be linked to banks’ loyalty programs and other services, such as offering expedited payments for a fee.
However, Mr. Jabbour said that most banks “are resigned to the fact that” mobile banking “will be free at some point” even if they charge fees in their initial rollout.
Nick Holland, a senior analyst at Aite Group LLC of Boston, said that for mFoundry, “it’s obviously meaningful that Fidelity entered into an agreement with them.”
However, he is cautious about assessing its true value until banks sign up through the partnership next year. “It doesn’t mean anything until the paper is signed,” he said.
Still, “it indicates mFoundry is seen as a viable player” in the mobile banking space, and that “there’s still the opportunity for a variety of players to still have significant stake in the market,” Mr. Holland said.
Firethorn Holdings LLC of Atlanta, a rival provider of downloadable mobile banking software, has announced deals with several banks, including Synovus Financial Corp. and Wachovia Corp.
“There’s still a bit of a free-for-all,” Mr. Holland said. “Nothing’s solid out there.”
It is interesting that Fidelity wanted a downloadable application, since that model can be restrictive — rival products that work through the mobile browser or text messages are easier for customers to access, he said.
However, the nature of mFoundry’s product does not substantially limit its audience. “mFoundry’s solution is designed to work on any handset that runs” the widely-used Java programming language, and most modern phones do, he said.
