IBM Helps Businesses Move Checkbooks to the Internet

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SOMERS, NY - 30 Jun 1998: -- IBM today announced it is working with customers BankBoston and NationsBank in a live market trial with the U.S. Treasury to enable businesses to extend paper checks to the Internet. The new Internet payment option furthers IBM's push to help companies become e-businesses by allowing banks to offer an efficient way for customers to issue and receive checks via the Internet.

Electronic checks (echecks) address the electronic payment needs of millions of businesses that today exchange traditional paper checks with other vendors, consumers or the government. Echecks follow the same procedures and regulations as paper checks, giving businesses a secure Internet payment option and offering an easy entry into electronic commerce without making significant investments in new technologies or legacy systems.

IBM, BankBoston and NationsBank are participating in an echeck market trial with the Financial Services Technology Consortium (FSTC), an organization comprised of leading financial services and technology companies. The FSTC is working with leaders from the banking and technology industries to introduce new technologies into the U.S. banking system that will benefit banks and their customers. The Financial Management Service, the Treasury bureau responsible for the U.S. government's payments, collections and central accounting functions, is actively seeking more efficient ways to complete payments.

For the market trial, BankBoston and NationsBank will enable their participating customers to accept and deposit echecks issued by the U.S. Treasury. IBM is providing the echeck bank server used to process echecks deposited at these banks. Developed in conjunction with Agorics, Inc., IBM's echeck bank server is its first Internet payment product based on the FSTC's echeck standard.

"Echecks are the latest addition to IBM's suite of Internet payment solutions, which also include credit and debit components," said Mark Greene, vice president of Internet Payment & Trust Solutions at IBM. "We're expanding the availability of Internet payment options for our customers and, in the process, we're enabling them to become more efficient e-businesses."

Echecks extend IBM's leadership in the financial services industry by providing an Internet bridge to the company's widely used Check Processing Control System (CPCS) software. IBM's CPCS and check sorters are used by a majority of the large banks in North America. IBM's check processing technology touches over 80% of the checks in North America.

IBM Research contributed significantly to the development of the echeck system design. The FSTC invited IBM Research to the echeck effort three years ago based on IBM's expertise in security and secure hardware. Researchers from IBM's T.J. Watson Research Center helped with the development of the Financial Services Markup Language (FSML) and the Signed Document Markup Language (SDML), which provide a structure for creating, processing, and verifying digitally signed electronic documents. IBM researchers also designed the generic architecture for echeck bank servers, the specific implementations for NationsBank and BankBoston, and the Research Station Toolkit, which is used to investigate irregular checks.

"This technology provides a dramatic new mechanism for organizations of any size -- and, eventually, individual consumers -- to easily make secure electronic payments to anyone, anywhere," said Jeff Kravitz, lead IBM Research staff member on the project.

As echecks move out of market trial and into production, IBM plans to integrate the technology into its CommercePOINT* Payment product line. IBM CommercePOINT includes IBM CommercePOINT Wallet, IBM CommercePOINT eTill, IBM CommercePOINT Gateway and IBM Registry for SET**.

IBM is the world's largest information technology company, with 80 years of leadership in helping businesses innovate. IBM Software offers the widest range of applications, middleware and operating systems for all types of computing platforms, allowing customers to take full advantage of the new era of e-business. The fastest way to get more information about IBM Software is through the IBM Software home page at Additional information on IBM's involvement within the FSTC echeck market trial can be found at

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* Indicates trademark or registered trademark of International Business Machines Corporation.

** IBM Registry for SET is currently undergoing SET compliance testing. Other company, product, and service names may be trademarks or service marks of others.

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