Barclays Bank is trying to blaze a banking industry trail into digital certification.
Offering a service that bankers in the United States and elsewhere have mostly just been talking about, London-based Barclays introduced Endorse, a smart card for authenticating on-line messages or transactions.
The card's computer chip contains electronic codes for a digital signature. When attached to a transmitted document, the signature assures authenticity and, under emerging precedents, would carry the same legal weight as a written signature.
Barclays sees so much promise in being a signature provider that the service stands alone. The black-colored card looks like any number of the electronic purse devices proliferating in Europe, but bank officials are quick to point out that there are no payments stored on or associated with Endorse.
At the same time, Barclays stands up for the role it-or any bank-can play as the trusted party making the initial customer sign-up, assuring in the process that the card is inextricably tied to the correct individual.
The card is a key to the Internet, and a personal identification number is the key to the card. If the card is lost or the PIN forgotten, a new card must be issued because the PIN is a secret shared only by the card and its carrier.
Though Barclays will deliver Endorse cards by mail, initially to pilot participants in areas served by nine of its branches, the customers have to come to the branches to have their credentials verified and the cards activated.
The in-person aspect "gets us away from the looser authentication available over the Internet" and can reinforce the bank-customer relationship, said Steve Collins, director of Barclays Bank PLC's emerging markets group in Northampton, England.
The same argument has been made by Scott Lowry, president of Digital Signature Trust Co., a certification venture started last year by Zions Bancorp. of Salt Lake City. Mr. Lowry said bankers "own the last mile" between the Internet and the consumer and should assert this advantage to control the crucial sign-up link in the on-line security chain.
Certification is the subject of lively debates in the United States and competition is heating up among programs like Mr. Lowry's and vendors such as Entrust Technologies Inc., GTE Cybertrust Solutions, and Verisign Inc.
There is nothing theoretical about Barclays' initial implementation. It launched the six-month Endorse trial two weeks ago in conjunction with three United Kingdom agencies for the on-line registration of self-employed people.
"The service will save time, eliminate paperwork, and allow the newly self-employed to conduct their dealings with government (e.g., tax and customs filings) more conveniently," said Public Service Minister David Clark.
"The benefits of electronic commerce will only be fully realized when individuals and businesses can transact with trust," said Roger Alexander, managing director of Barclays' emerging markets group. "We are bringing about this trusted environment through the innovative use of smart cards and digital signatures in a highly usable way."
Mr. Alexander pointed out there is nothing exclusive about Barclays' service or its relationship with the U.K. government.
National Westminster Bank "made a similar announcement" about digitally signing small-business documents, said Tim Jones, that London competitor's chief of retail banking.
For now, the Natwest communications can be initiated only in branches. Barclays is the first to permit true portability. Combined with a Smarty, a device from Fischer International Systems Corp. and SmartDisk Corp. that enables a personal computer to read a smart card, Endorse can secure communications from homes or elsewhere.
"We are not aware of anyone else who has put this model together," Mr. Collins said, adding that Barclays had been working on aspects of it for at least two years.
Though the underlying technology is "open and generic," Barclays has some copyright and trademark protections that it hopes to "leverage" through partnerships. Mr. Alexander said the United States could be an attractive market.
Typical for an electronic commerce innovation, Endorse required many companies' components. For example, Barclays uses Root CertAuthority, certificate technology from Certco of New York; nFast 300, a cryptographic accelerator that speeds the necessary mathematical calculations, from nCipher Corp. of Cambridge, England; processors from International Business Machines Corp.; hardware security modules from Racal; chips from Siemens; and cards from De La Rue Card Systems.
Microsoft Ltd., meanwhile, committed to releasing a tool kit to help build the Endorse smart card and authorization service into Web software.
Having come out of a Barclays unit that explores advanced technologies, Endorse could eventually be integrated with biometric identification and on-line malls like the bank's Barclaysquare.
Revenue at first will come from users like government and Internet service providers, but if authentication becomes widespread and desirable, consumers might even pay for the card, Mr. Alexander said.