If you had made online purchases through a credit, debit or prepaid card, chances are you have used Infinitium Group's services.
The local e-payment specialist is pioneer in introducing the dynamic one-time passwords (OTP) technology for e-commerce transactions in the region. The technology, a two-factor 3D-Secure authentication method, has now been mandated by most central banks.
“We are basically the behind-the-scene technology provider for banks on the acquiring as well as issuing side,” says Ho Ching Wee, CEO and co-founder of Infinitium.
In Malaysia, we are empowering 15 banks - including most of the major ones. So, chances are you’d be using our services without knowing it
What Infinitium does, essentially, is generate, deliver and authenticate the OTP on behalf of banks. But long before SMS-OTP became an ubiquitous, added layer of security to complete online transactions, Infinitium started out as an internet solutions company, helping set up web pages and online storefronts for clients two decades.
It was around 2009 that Ho noticed a ‘pain point’ facing consumers who shop online.
“At that time, we saw a lot of shopping cart drop out - there was a lot of fear to complete transactions, out of security concerns. So, we went to talk to Visa and Master. They recognised that it was a challenge for them too. At the same time, they were a lot of encouragement to move away from just using static pin,” explains Ho.
(Static pins are traditional password-based authentication)
While not the first to introduce OTP technology globally, Infinitium was among the early movers in the region providing such authentication solutions to banks.
The company now boasts a network of 50 banks across Malaysia, Indonesia, Singapore, the Philippines, India, Vietnam and Cambodia, putting it in touch with a base of 180 million cardholders.
“In Malaysia, we are empowering 15 banks - including most of the major ones. So, chances are you’d be using our services without knowing it. As of October, we process an average of 12 million authentications every month,” says Ho.
We Are Early Innovators in the Region
Despite also offering payment processing and fraud detection services, the company has carved a robust niche in payment security, a feat that the Ho is modestly proud of, “We are doing okay,” Ho nods with a smile.
But what’s really keeping the 45-year-old excited is the e-commerce boom in countries like Indonesia and India, supported by their massive populations.
India’s growth rate is tremendous
In December 2016, the group rolled out B-Secure with Dynamic OTP Authentication with Indonesia’s leading payment system service provider, PT Artajasa Pembayaran Elektronis (Artajasa).
Artajasa operates interbank network ATM Bersama, that has 94 bank and non-bank institutions as members, with a cardholder base of 107 million.
“What we have done with B-Secure is we’ve created a domestic authentication platform. By creating this and giving this capability to 94 banks, now their proprietary (ATM) cards can also be used to make online purchase,” Ho explains.
This is significant as the vast majority of card transactions in Indonesia still take place through the country's ATM system. B-Secure allows ATM Bersama member banks to take part in e-commerce transactions.
“A lot of these banks are Bank Daerah, typically the smaller banks. Today, consumers in the second tier markets would buy online, get the code, go to the ATM and physically do the cash transfer. So, by us creating B-Secure, these transactions can be done real time, without them having to leave their homes to go to the nearest ATM.”
In India, Infinitium has formed a strategic partnership with Euronet Services India Private Limited to offer technology innovations in the financial services and retail sectors, particularly in helping to ‘scale up demand’.
“In half a year, we are processing close to two million transactions a month in India."
“By comparison, it took us close to two years with 15 banks in Indonesia to hit one million transactions. So, India’s growth rate is tremendous,” says Ho, adding the bigger population helps."
The Next Big Thing in Payment is IOT and Tokenisation
When asked about next big thing is payment solutions, Ho says the company is keeping a close eye on biometrics and tokenisation.
On biometrics, Ho says the company is already conducting pilots tests with four banks, two in Malaysia and Indonesia, respectively. He expects to see banks start migrating to biometric authentication - or 3D Secure 2.0 - by the first quarter next year.
Payments, in the future, will not only happen from your wallet. Payment will happen from connected devices
“How it works is, instead of your bank sending an OTP when you buy online, you can do biometric authentication using face, voice or fingerprint through a banking app,” says Ho. “If you don’t have it, then it will fall back on SMS. So, we are adding multiple form factors of authentication.
Ho says the company, that employs 110 staff across the region, invested about five million ringgit this year into research and development (R&D), in anticipation of biometrics rollout. “We typically allocate 15 percent of our profits on R&D,” says Ho.
Meanwhile, the rollout of tokenisation - much further down the road - will be driven by the Internet of Things (IoT). “We foresee more and more transactions will come in the form of IoT.” says Ho.
“Payments, in the future, will not only happen from your wallet. Payment will happen from connected devices, like your refrigerator. So, that’s why we need a token, linked to a specific credit card, to protect sensitive datas and provide protection to consumers and businesses.”
Biometric Tech is Here, We Are Just Waiting for Consumers To Adopt It