Payfone, a customer identity verification provider, said Wednesday it's changing its name to Prove and acquiring mobile authentication technology from Early Warning Services.
Early Warning Services, operator of the Zelle network and provider of identity, authentication and payment services, is owned by seven of the largest U.S. banks.
“Especially now with COVID, people aren’t going to branches or the branches are closed,” said Rodger Desai, Prove's CEO. “There is even more of a need to make sure digital and call center experiences are as convenient as possible, but secure and private at the same time.”
Prove's technology verifies customers’ identities and automatically fills out applications when they open bank accounts; it also authenticates existing customers when they do business with their banks through a call center or online.
The company specializes in phone intelligence that helps banks understand the risks associated with various transactions without dragging out the process by asking knowledge-based questions or sending passcodes. It reviews factors such as customer behavior, how long customers have owned their phone numbers and whether customers are physically in possession of their phones while interacting with the bank.
Prove, with the acquisition, now counts 500 financial institutions as clients, including seven of the top 10 U.S. banks.
In 2013, Prove first partnered with Early Warning Services to market its products to banks. But the acquisition will strengthen Prove’s ability to do multifactor authentication, executives say.
“Early Warning has enjoyed an exclusive partnership with Prove since 2013, where together we have successfully enabled mobile authentication to become a best practice in the financial services industry,” Lou Anne Alexander, chief product officer at Early Warning, said in an email. “We have realigned our relationship to position Early Warning as the gateway through which the financial services industry can connect our products to Prove’s solutions, along with other third-party identity and authentication solutions.”
“By acquiring the [authentication] business of Early Warning Services, Prove can bring a leading two-factor authentication suite in-house,” said Eric Emmons, managing director at MassMutual Ventures, the investment subsidiary of MassMutual, and an investor in Prove.
Desai said the acquired services will let banks tweak their security procedures and set rules to suit different situations, without causing unnecessary frustration for the customer or costing the bank time and money — say, if the customer abandons a new account application partway through, or by forcing the bank to do a manual verification.
“It’s the TSA PreCheck concept,” said Desai. “How do you PreCheck 90% of transactions without causing more fraud and keep 10% for more inspection?”
