1. 1 Parex bank experience with Digipass tokens Deniss Vorona Online Banking Project Manager

2. 2 Who We Are A leading Latvian bank Branches and Representative offices in Europe (Latvia, Lithuania, Estonia, UK, Germany, Sweden,..), Russia and other CIS countries, Japan. Two subsidiary banks offer services in Lithuania (Parex Bankas) and Switzerland (AP Anlage und Privatbank)

3. 3 History: Milestones 1992: first client 1994: first payment card 1996: first Digipass tokens are used for fax banking 2001: first user performs online banking transaction

4. 4 History: Previous Security Schemes Homebrew code card, which required manual computation with factored in payment parameters. It was used for: –Fax banking –Remote banking application (modem-based) PGP for email banking

5. 5 History: Digipass Tokens Advantages Secure Easy to use Mobile Unconnected No installation/software support Cannot be copied Adheres to Electronic signature law

6. 6 History: A Simple Solution A separate application, not connected to banking system Manual signature verification Printing slips of verification success

7. 7 Token Usage Online banking (digi.parex.lv) –Login (dynamic password) –Document signatures Fax banking Access to the safes

8. 8 Token Applications Dynamic password (time-based response only) Signature

9. 9 Signature Parameters Payer account number Amount Currency code Beneficiary account number

10. 10 Online Banking Login

11. 11 Online Banking Login

12. 12 Payment Signature

13. 13 Payment Confirmation - Go3

14. 14 System Architecture Online bankingCore banking system Authorization server Administrative tool

15. 15 Authorization Server Functions Token data Token lock/unlock Logging Signature rights management Document uniqueness control

16. 16 Separate Server Advantages Authorization server has stable and strict interfaces which are very rarely changed Easy to offer Digipass-based services in other banks within Parex Group

17. 17 Simple Architecture Operator tool Authorization serverAdministrative tool

18. 18 Tokens Used Tokens issued in the past: DP500 DP560 Tokens issued now: DP700 Go3

19. 19 Tokens Used Dp500 –A good model with a calculator –Not supplied anymore

20. 20 Tokens Used Dp560 –Dp500 successor –Stylish design –Good for the average user –Better battery life –Messages in several languages

21. 21 Tokens Used Dp700 –Good for heavy use –Best for signatures –Messages in two languages –Target audience: businesses, active users

22. 22 Tokens Used Go3 –Easy to use –Target audience: private customers

23. 23 Transaction Statistics 1996< 1000 1997~ 80000 1998~ 190000 1999~ 350000 2000~ 550000

24. 24 Situation in Latvia At least 9 out of 23 commercial banks offer services using Digipass tokens ID-cards (smart cards issued by the state) are not used to secure online banks State web sites tend to use Online banks to secure e- services

25. 25 Implementation Challenges Clear strategy Difficult to phase out old services Managers are hard to convince Clients are hard to convince - not all are security- conscious Price

26. 26 Implementation Challenges Planning token configuration for the future User experience Instructions

27. 27 Questions? Don’t hesitate to ask!

28. 28 Conclusion Think about security before your clients have to!