German banks working on electronic signature for e-commerce

Germany's four biggest banks will develop a single standard of digital signature by the end of this year to allow electronic commerce via mobile telephones and hand-held organisers.

Deutsche Bank, the largest bank, said the four plan to issue customers with a code held on a so-called smart card and a personal identification number so they can order and pay for goods, transfer money or sign e-mail while on the move.

The move comes just a few weeks after the German parliament's upper house passed a law giving electronic signatures the same status as their handwritten counterpart.

The lower house passed the law in February, complying with a European Union directive aimed at increasing electronic commerce.

While the high cost of the mobile devices able to read the cards may initially restrict the service to business customers, more and more phones and organisers are being fitted with a card reader as standard, Deutsche Bank spokesman Klaus Thoma said.

Deutsche Bank said it will work with Commerzbank, Dresdner Bank and HypoVereinsbank to develop the system, known as MoSign, short for Mobile Signature.