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It is in providing
that missing ingredient that Certegy pins its hopes on becoming a major
player in web-based payments. When a web merchant uses the Certegy e-checking
service, the web shopper must fill out basic identification information
(name, address and drivers license number), which is instantly matched
against the Certegy database on that consumer. The shopper then receives
a series of multiple-choice questions from the Certegy database that relate
to details about the customers mortgage, car, credit card or even student
loan history. The responses are then verified by matching them against
the Certegy database. If theres a match, the check is approved for
payment, and the web shopper is sent via e-mail a user name and password
that is used to verify all future e-check payments by that shopper on
The real beauty about
the service, however, is that Certegy guarantees payment to the merchant
once the consumer has cleared the authorization hurdle, a guarantee that
eliminates the fraud risk merchants must accept with credit card payment.
While consumers have 60 days to stop or reverse payment on an ACH transaction,
the process is not as easy or as routine as charging back a credit card
transaction, which means that the paid order is far more likely to stick
on the books. Since rolling out its e-checking product a year ago, Certegy
has signed up 50 retailers for the service, and third-party processors
have used it for still other merchants. Already, says Certegys Whitfield,
checking comprises 5% of all retail payments on the web, and she believe
that number will eventually go to 15% as momentum for the service builds.
That estimate may be low, given the response Certegy has lately been getting for its new e-checking services. In just the last few months, we are hearing from merchants we talked to about the product a year ago, says Certegys Whitfield. Theyre saying, Were ready for it now. We need more sales and profit, and we need to expand our payment options on the web.