Making Money from Tokens

Security is looked as sunken investment where security solution is a cost that is part of the operation cost for running the business or service. Now it is changing esp. for the retail and corporate online commerce and banking.

BFSI industries are looking at authentication and making the needed investments due to following three reasons -
  1. Regulation across the globe is demanding all the banking and trading companies to implement Second factor Authentication.
  2. Online interface is a must. you want to keep your customer, they demand online option and for free.
  3. SMS is not reliable and costly affair when the volume and velocity of the users and their transactions grows exponentially. You cannot give SMS as only option.
Esp. Banks in Asia have started looking into offering choice to the customer. Starting in Singapore, India, Malaysia all the countries are looking at offering variety of tokens to their customers but interesting they are charging for these tokens.

Please have a look at the following two examples of Asian banks - OCBC from Singapore and AXIS Bank from India.

OCBC Bank - they have launched 3 different form of tokens - SMS based , Mobile Phone based (mobile banking along with OTP generator) and Hardware token.


choice of tokens

Mobile Token is Strongly Recommended

AXIS Bank - they have launched again 3 different forms of tokens - SMS based, Web Token (OTP generated for your browser - not an exe installer but java applet approach) and Hardware Token.

Netsecure - added authentication for
retail and corporate banking



hardware token for INR 800 per token
and replacement for INR 500

Web token for INR 150 pa


SMS Token for INR 150 pa

Above shows how banks are moving into generating revenue from a value added service to their internet banking. With this approach, monetizing the authentication token, there are changing the mind set on creating security as a sunken cost.

It is good for the customer too as they get to chose their token and also bank is able to offer not cheap security solution.

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