North Dallas Bank & Trust Co. Takes Debit and ATM PIN Verification In-house with Thales
Using Thales HSMs, North Dallas Bank & Trust Co. Improves Service To Customers While Lowering Costs And Protecting Pin Data.
Founded in 1961, North Dallas Bank & Trust Co. (North Dallas Bank) is a rock of financial stability. Even as other banks experience the consequences of poor decision making, BauerFinancial, a leading bank rating firm, recently bestowed its highest possible rating for financial strength and stability on North Dallas Bank for the 78th consecutive quarter. With $1 billion in assets and an 11 percent growth rate last year, the bank is attracting customers who value stability in uncertain times. To improve service to customers by offering real-time account information, North Dallas Bank recently moved its ATM and debit verification processes in-house. The bank chose hardware security modules (HSMs) from Thales to protect in-house processing, giving the bank confidence that customer PINs and its reputation are safe from breaches.
“Customers want the balance they see online and on ATM receipts to reflect all their transactions, but with outsourced processing, customers had to wait,” says Greg Niemeyer, executive vice president of marketing and operations for North Dallas Bank. “Looking at customer service, security, and costs, it made sense to take control of ATM and debit transactions. With Thales HSMs providing security, our customers’ PINs have never been safer.”
Taking Charge of Transactions
Until recently, North Dallas Bank outsourced its ATM and debit transaction verification processing to a larger bank. Using an HSM-protected process, the larger bank drove PIN verification and sent North Dallas Bank a transaction file detailing activity. To update customer account balances, North Dallas Bank regularly posted the file to its internal systems.
While the larger bank was well-regarded and followed leading security practices, North Dallas Bank did not like that its customers’ data was outside of its control and that another bank had so much potential influence over its reputation. Not only expensive for the bank, outsourced processing also inconvenienced customers because it often took several hours for balances to reflect recent ATM and debit transactions.
According to Niemeyer, “It made sense to move processing in-house while continuing to protect customers with excellent security. A risk to PIN privacy is a threat to the trust we’ve earned from our customers. That is why our solution is protected by Thales HSMs. Their reputation is as solid as our own.”
Benefits with Thales Solutions:
- Securing customer PINs with tamper-resistant hardware
- Protecting its reputation for stability and great service
- Lowering transaction processing costs
- Supporting future growth with secure services
Exploring the Technology
Realizing that tamper-resistant hardware is the cornerstone of a secure PIN verification process, the bank carefully evaluated the payment HSMs on the market before selecting the Thales HSM 8000. In speaking with vendors, the bank’s decision makers learned that Thales HSMs are trusted by many of the world’s leading financial institutions, and that Thales HSMs protect 70 percent of the world’s card transactions. Ready to integrate with the STAR Network that provided ATM and debit infrastructure to the bank and the bank’s S1 Postilion payment software, Thales HSMs also offered ease of deployment.
“We realized that we could buy an HSM that was similar to a Thales HSM or we could buy a Thales HSM,” explains Niemeyer. “Why compromise? We decided to go with Thales rather than a supplier who might be playing catch-up with technology or that might not be around for the long term. The Thales people we worked with were clearly encryption and key management experts, and they helped us gain a deeper understanding of the technology.”
Easy Implementation and Operation
North Dallas Bank integrated its S1 solution with two Thales HSMs. In less than a day, the HSMs were ready to provide a protected environment for PIN encryption and decryption. Niemeyer reports that, “One consultant implemented our Thales HSMs in just a few hours. The HSMs worked well with S1 software and the STAR Network right out of the box. They require very little maintenance, so the cost of ownership is low.”
Increasing Customer Satisfaction—and Profits
With its new system in place, North Dallas Bank verifies its customers’ transactions in-house. When customers use their North Dallas Bank card at an ATM or for a debit transaction, their PINs are encrypted until they reach the Thales HSM. Inside the protected hardware environment of the HSM, the PIN is decrypted and verified. If the PIN is valid, the system approves and processes the transaction. PINs are never decrypted outside the HSM.
The bank is enjoying a number of benefits, as compared to outsourced transaction verification. Each transaction posts quickly, increasing customer satisfaction by providing easy access to more accurate balance information. Because it controls its customers’ sensitive PIN information, North Dallas Bank is more confident that the process and its reputation are secure. As an added benefit, the bank has seen transaction processing costs go down significantlyhelping to make ATM and debit services more profitable.
“Add up the benefits of increased customer satisfaction and lower processing costs,” notes Niemeyer. “There’s no question that moving to in-house PIN processing with Thales HSMs and our S1 solution was a great decision.”
North Dallas Bank & Trust Co., established in 1961, has more than $1 billion in assets and is a locally owned bank with five locations in the Dallas, Texas, area.
To learn more about North Dallas Bank and Trust Co., visit http://www.ndbt.com.
A Foundation for Growth
As people and businesses switch to banks that deliver unwavering stability, North Dallas Bank expects more strong growth. Niemeyer sees the security provided by the Thales HSMs making a key contribution. He says, “Our reputation attracts customers and inspires confidence. We plan to support our reputation by continuing to make prudent financial choices. But today, data security is also vital to success. By using Thales HSMs, we’re protecting our customers’ PINs with the same unwavering diligence we apply to safeguarding their deposits.”