A Virtual Safe-Deposit Box

Posted by Mark Brousseau

An interesting article from Wall Street & Technology about Wells Fargo's new vSafe offering:

Wells Fargo Introduces vSafe, a Virtual Safe-Deposit Box
May 21, 2008

Security and convenience -- that's what San Francisco-based Wells Fargo is promising customers with its new vSafe service. The Web-based virtual safe-deposit box allows users to archive almost any file format, from Microsoft (Redmond, Wash.) Word documents and PDFs, to audio and video files, according to Stephanie Smith, senior vice president of the Wells Fargo Internet services group.

"You can import any electronic or digitized document," Smith explains. Preestablished folders, such as "Medical" and "Family," help users organize their documents, and users can create or delete folders to personalize the storage solution, she adds. "Customers can just drag and drop their documents into those folders," Smith says, emphasizing the product's ease of use.

According to Smith, the product was conceived in response to Wells Fargo's ($575 billion in assets) research into how customers manage their financial lives, including document storage. A study of the bank's customers revealed that three-quarters of participants "weren't happy" with their own document management, she reports. From a battered shoebox stuffed with papers to unreachable manila folders on top of the refrigerator, customers' homemade storage solutions were neither secure nor convenient, Smith says.

From the catastrophic (accessing insurance policies after a house fire) to the more routine (getting copies of medical records while you're traveling), the the Web-based vSafe service, however, gives customers secure access to their files at any time, from any location, unlike hard drives and other archiving solutions, Smith contends. But, she cautions, vSafe is intended only as a backup storage solution. "We're not telling customers that it's as good as the original," Smith stresses. "It's a copy."

An Online Vault
The vSafe service, Smith adds, leverages the same security measures and stores customer data behind the same firewall that the bank uses for its online banking platform. "It's an extension of what we've been doing for 156 years -- safely and securely storing customer information," she comments, adding that customers who want additional protection can secure their accounts with two-factor authentication supported by RSA's hardware tokens, which can be purchased from the bank. Bedford, Mass.-based RSA is the security division of EMC (Hopkinton, Mass.).

Smith notes that the new offering, which will be integrated with Wells Fargo's other online banking services, was created without outside vendor support. "We built this ourselves," she says, adding that the solution employs "much of the same [technology] as we use for Wells Fargo online banking."

Javelin Strategy & Research (Pleasanton, Calif.) analyst Mary Monahan notes that the trust Wells Fargo has established with consumers may help adoption of the vSafe service. "Wells Fargo is a name known to them," she observes. The service, she adds, appears to meet a customer need and gives users a reason to stick with the bank, helping Wells Fargo's customer-retention efforts.

A Green Solution
In addition to helping customers organize their document storage, the vSafe product also can help the environment, Wells Fargo's Smith says, adding that the bank sees the service as an extension of its environmental initiatives. It will help customers "lessen their carbon footprints ... through online banking," she explains.

For example, customer statements will be uploaded to their vSafe accounts automatically. Though Javelin's Monahan says bank customers in general are "not really ready to get rid of their paper statements," she adds that the new Wells Fargo service is "very green -- and secure."

The cost of the vSafe service to Wells Fargo customers starts at $4.95 a month for one gigabyte of storage -- approximately 10,000 documents. The bank initially offered the vSafe service to its team members in March. A public rollout to personal banking customers and small business clients is scheduled for the summer.