U.S. Bank Adds to the Roster of Secure Vault Payments Acceptors

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The automated clearing house online-payments system known as Secure Vault Payments took another step forward this week when U.S. Bancorp, the nation’s fifth-largest bank and the biggest bank so far to offer SVP, announced its first merchant, the University of Wisconsin-Stout. The addition of the 9,300-student UW-Stout brings adds another sizable acceptor to SVP’s roster of merchants and billers, though the payments option nearly a year after its commercial launch still is accepted in only a handful of places.

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Denver-based eWise Systems Inc., which operates the SVP switch for ACH governing body NACHA, says nine organizations and merchants currently accept SVP. Some 36 financial institutions offer it, though a number are owned by the same bank holding company. Columbus, Ga.-based Synovus Financial Corp. is a major participant.

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Alexander Grinberg, chief executive and founder of eWise, says more announcements about financial institutions offering SVP, including at least one top 10 bank, are coming soon. As those banks come on board and pitch SVP to consumers and some to their corporate clients, SVP’s acceptor base is likely to grow, though that can take time. “Financial institutions are bringing in an increasing number of their merchants through their network,” says Grinberg. “We’re absolutely delighted with the number of banks going live and integrating currently.” He adds, however, that, “from my perspective it is never fast enough. We would like to see a faster, more aggressive timeline … sometimes it takes a little longer than we would like.”

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EWise and its bank partners currently are concentrating on four acceptance sectors: education (mainly for tuition payments), government agencies, non-profits, and private-sector merchants. With Menomonie, Wis.-based UW-Stout joining the ranks, four universities accept SVP, including the University of Georgia, Columbus State University, and Auburn University. Lenexa, Kan.-based TouchNet Information Systems Inc., a specialty payments gateway serving 700 schools, enabled the SVP integration at UW-Stout, according to U.S. Bank.

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For UW-Stout students and parents, the advantage of SVP is a no-fee tuition-payment system that doesn’t require them to give card and other sensitive data to an outside party, according to Eric Lim, vice president and senior product manager for Minneapolis-based U.S. Bank’s Treasury Management unit. The college will benefit from fewer paper checks, guaranteed funds, and reduced exception-processing expenses, he says. “It’s a fairly easy process whereby they recognized the value of Secure Vault Payments,” says Lim. U.S. Bank is working with UW-Stout to promote the service through e-mails, brochures, and even the on-campus cable network.

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If their bank provides the service, consumers use SVP by logging on to their online-banking system and selecting the SVP option. Payments are classified as ACH credits. Consumers are not charged for payments. The acquirer, or merchant acceptor’s bank, sets its own pricing. The consumer’s bank receives 50 cents for a bill payment and 40 cents for a government payment. EWise, which recently raised $14 million in venture capital, collects 6 cents each from the consumer and acquiring banks.

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