Logically, an electronic check is nothing more than an electronic payment authorization. To accomplish this FSTC married two core components of technology together, a markup language, and digital signatures.
While these technology features are now gaining widespread acceptance, the eCheck project is the first Financial Services industry effort to combine and apply these techniques to creating payment instructions safe enough to use through the Internet.
Financial Service Markup Language (FSML)
The Financial Services Markup Language (FSML), like HTML, is a block structured data description language based on SGML. FSML uses tags to structure messages into blocks and data elements. The data elements defined are specific to the needs of creating an electronic payment message.
Unlike HTML, which focused on how to display a document, FSML is focused on defining the data contents with enough specificity to allow a software application to process the document completely. This requires detailed definitions of the syntax, semantics and values associated with data elements. The complete description of how this is done may be found in the FSML 1.5 Specification, and in the implementation guides which supplement the specification.
Although the current specification was developed by the FSTC eCheck Initiative to support the US Treasury pilot, we continue to evolve FSML by adding additional documents and message types. FSML is designed to support a full range of payment instructions, using a single approach. These include electronic checks, ACH payment authorizations, ATM network transaction authorizations, and variations of a check, such as a postal money order or gift certificate. These will be added to the specification as needed by the market. We expected that FSML will evolve to conform with XML, simpler subset of SGML now gaining widespread adoption.
The second key technology component used to create the eCheck technology is Public Key Cryptographic Digital Signatures. Digital signatures are mathematical calculations which provide a unique ability to identify the creator of the signature and the specific document which was signed. They provide tamper proofing, authentication, and the ability to determine the authority of the signer of the document.
FSTC’s eCheck technology extends the basic, and soon to be commonplace, technology of digital signatures by applying them to a markup language based document, and by recognizing the need for signatures of varying types, including basic signing, co-signing, and countersigning or notarizing.
Digital signatures are often used with Cryptographic “Certificates”. A certificate is similar to a signature card, except in all electronic form. Rather than a simple comparison between the certificate and the signature, the certificate holds the public key of the signer, which can be used to validate the signature by a cryptographic computation. eCheck uses these certificates to enable a receiver of the check to determine the validity of the signatures. Initially, these certificates are actually transmitted with the eCheck, but alternative models have been proposed where the transmission, or possibly even issuance, of the certificate is not required.
An additional aspect of FSTC’s eCheck technology allows digital signatures to be applied to document blocks, rather than to just the entire document. This capability is used to enable parts of a document to be separated from the original, without compromising the integrity of the digital signature. More detailed description of this can be found in the eCheck architectural overview.