ING Direct uses SOA for new service

Banking group ING Direct is relying on an IT infrastructure based on service oriented architecture for the success of its new mortgage service. Arif Mohamed looks at how cutting complexity and increasing responsiveness have been key to the project

Last October ING Direct went live with its new online mortgage service, in a bid to make an impression on the well- established UK mortgage market as the first new entrant in a long time.

New IT director Peter Knight, who joined the firm last summer, found himself managing a cutting-edge IT system that was relying on a service oriented architecture (SOA) and the latest web technologies for its success.

The mortgage IT programme is ING Direct's biggest and most complex IT project to date. The Dutch financial services provider said it was the next logical step for a firm which entered the UK market in May 2003 and is well known for its online savings product which it launched in the same year.

ING Direct started an online home insurance range of products last year, which also depend on web technologies. So far these have been successful, said Knight. However, the technology that needed to be put in place to allow customers to specify and buy mortgages online made for a tricky IT project.

The aim of the IT project was to provide customers applying for mortgages - by phone or online - with a simpler and faster experience, backed by a slick IT operation behind the scenes, said Knight.

The online mortgage system went live in October 2006, and over the Christmas period demand was strong. The shortest time it took for people to go through the mortgage pipeline was six days, compared with 21 for the industry average.

Although the product offering is simple, the ING system needed to link to several third-party systems, such as the Land Registry and various solicitors.

"This is a very large and complex programme of work. We are the first new mortgage issuer in the market in many years and the hurdles are pretty high. To differentiate yourself you have to offer something very strong, and you need to take a long-term view of it and invest in it. A mortgage product is not profitable in the short run," said Knight.

By employing a service oriented architecture (SOA) from the start, ING Direct was able to establish a modular applications platform that it could "plug" interfaces into, and make rapid changes as required, said Knight. "Because we are a relatively young business, we do not have a legacy of systems."

The SOA and web services approach means that application developers can implement small changes rapidly via programming interfaces that are easy to work with, said Knight.

"I have great hope for the future in changing functionality and products very rapidly due to the SOA infrastructure. We have automated every interface you can think of, and that is how we have managed to keep the process fast - it is all through the combination of up-front business thinking and intelligent IT."

ING Direct looked at the IT systems in other country branches where it operated and found that an SOA platform was being used in Canada. ING Direct's UK operation took the SOA blueprint from Canada because it did not want to build from scratch, said Knight.

The system uses a Unix back-end to carry out backroom database and financial functions, and a Windows front end that the system managers and users see when they visit the site. The bank also installed a mortgage origination system called Omiga which it bought off Vertex, a Canadian financial services provider.

The whole system uses a web services approach to expose the mortgage system to the front end, fetching and carrying user and product information back and forth, and the code itself is based on Java and XML.

To complicate matters further, ING Direct decided to use an onshore and offshore programming team from Capgemini to support the bank's 100-strong internal IT team. "We are a relatively small team in a successful company and Capgemini are helping us develop some parts of our mortgage system. We just needed the extra skills," said Knight.

Paul Coad, the Capgemini account director responsible for the project, said the bank wanted the application developed quickly, so a Mumbai-based Capgemini team of 65 people moved over to the UK to work alongside ING's project team in Reading.

No stranger to outsourcing, ING Direct signed several workplace services contracts in December 2006.

The deals with Accenture, Atos Origin, Getronics and KPN are worth a total of £515m, and the seven-year contracts for each of the suppliers will eventually lead to 430 ING staff in the Netherlands and Belgium transferring to Atos Origin, Getronics and KPN.

This type of intermingling of staff made the project both interesting and challenging, said Knight. ING Direct had to do its homework beforehand, to see how collaborating with an outsourced project team at Capgemini in the UK and India might work in practice.

"Capgemini was a good fit, but we needed to see how they worked with their people and how they treated them. Would they feel comfortable working with us on site and us with them in India? We interviewed people in India to find out," said Knight.

This was all done by Knight's predecessor, as Knight himself joined the firm as the mortgage project was underway. However, he was expected to back the project wholeheartedly and see it through to completion. "The team had worked long and hard I just came in at the tail end," he said.

Once up to speed, Knight had to stay on top of the project to see how things were progressing, and also assess the stress and "pinch" levels.

"We needed to find out how we could ensure that we could progress the project without burning people out," he said.

The key was to keep focusing on the IT project at all levels, from the developers up to the chief executive officer. Knight also held monthly and quarterly meetings with Capgemini and in-house staff.

"This programme was a very large and complex one, and I had to get up to speed rapidly coming in near the end of it. I needed to know how well we were integrating with the Capgemini team, and how our business partners were doing.

"When you join a new company, it is all about finding the official forums - and unofficial ones - and how to get things done. Some organisations work by consensus, and some have direct input from individuals, so charting a path takes time. Fortunately, ING was a very welcoming company with a great tech team," said Knight.

One of the braver moves Knight made was to re-mortgage his own house to trial the new online system, and to encourage his family and friends to do the same.

"As with any projects there were some teething issues. I got the first mortgage myself, and by doing this in a production environment with friends and family who were happy to go through the process, we found [the system] was a little clunkier than we liked. But now we have thousands of customers going through it," said Knight.

How other technology projects have boosted ING Direct

February 2007

ING Direct dealers start using biometric fingerprint technology on the trading floor to increase security and boost productivity.

The biometric fingerprint identity management technology and fingerprint readers enables dealers to access central dealing room computers quickly and securely.

August 2006

ING Direct strengthens its online banking security with the launch of two-factor authentication for all its customers. ING Direct uses RSA's Adaptive Authentication tokenless technology, which adds an additional layer of security to ING's website.

The technology uses a customer's PC or handheld device as the second-factor hardware device, and provides a positive identification based on device and network forensics, behavioural analysis and other parameters.

January 2005

ING Direct's UK division begins using data integration software to keep track of its 700,000 customers. The software from Informatica is used to feed more than one million transactions into ING's datawarehouse every day, and to help improve ING's marketing.

October 2004

Customer relationship management (CRM) software helps ING make an extra £2.8m in its first year of operation in the UK.

The 400% return on investment came as call centre staff used the CRM software from E.piphany to update customer account information and help identify opportunities for cross-selling services to customers.

ING rolls out fingerprint readers

ING outsources workplace services

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