Tractis launches support of FNMT certificates in the retail market at wholesale prices

Today, Tuesday 11th of November 2014, we formally announce the support of certificates issued by the Spanish National Mint (FNMT)

Which FNMT certificates does Tractis support?

Tractis provides full validation of all certificate profiles issued by the FNMT:

• Certificate of “Natural Person”.
• Certificate of “Legal Entity”.
• Certificate of “Public Administration” civil servant.

How much does it cost to use FNMT certificates in Tractis?

At the time of writing, Tractis provides full validation of 77 certificate profiles from 33 Certification Authorities in 14 countries. Under Prepay Fees the cost of using an electronic certificate in Tractis is:

• Authentication:
  • Authentication or using any certificate (except FNMT): € 0.00.
  • Authentication using an FNMT certificate: € 0.36.
• Signature:
  • Signature using any certificate (except FNMT): € 1.00.
  • Signature using an FNMT certificate: € 1.36.
• Validation:
  • Validation using any certificate (except FNMT): € 0.08.
  • Validation using an FNMT certificate: € 0.44.

Why using FNMT certificates is more expensive than using other certificates?

Almost all Certification Authorities worldwide charge for issuing certificates but allow to validate them for free. However, the FNMT follows the opposite pattern: Issues certificates for free and then charges for validating them. Depending on who performs the validation:

• If the person performing the validation belongs in the public sector (e.g.: a Public Administration) the FNMT offers free validation.
• If the person doing the validation is from the private sector (e.g.: a company), the FNMT charges for each validation performed.

Since Tractis is a private corporation, the FNMT charges us for each validation made and we pass this cost on to our users.

• Tractis Verifications: The cost of € 0.36 per authentication using an FNMT certificate includes the € 0.00 Tractis Authentication Fee and the € 0.36 FNMT Validation Fee.
• Tractis Contracts: The cost of € 1.36 per signature using an FNMT certificate includes the € 1.00 Tractis Signature Fee and the € 0.36 FNMT Validation Fee.
• Tractis SVA: The cost of € 0.44 per validation using an FNMT certificate includes the € 0.08 Tractis Validation Fee and the € 0.36 FNMT Validation Fee.

Why has Tractis not offered FNMT support before?

Tractis started business in 2005 and has not offered support of FNMT certificates until today. The certificates issued by the FNMT are the ones most used in Spain, well above the Spanish electronic National Identity (“DNI electrónico” or “DNIe”) card issued by the Police General Directorate (“Dirección General de la Policía” or “DGP”). For example, of all electronic transactions with Public  Administration bodies using electronic certificates in 2013:

• FNMT: 3.9 million certificates issued as of November 2014 and 99,31% of the transactions in 2013.
• DGP: 38 million electronic identity cards issued as of November 2014 and 0.7% of the transactions in 2013.

In other words, although there are almost 10 times more DNIe than FNMT certificates (38,000,000/3,900,000), in actual use FNMT wins by a landslide. The usage of FNMT certificates is 143 times larger than that of DNIe (10,104,585/70,528). Moreover, taking into account the difference in issued bases, the use per FNMT certificate is some 1,400 times that of a DNIe (9.7 x 143).

Since Tractis was born in Spain, it is legitimate to ask why it took us nine years to support FNMT certificates. Our response has changed over time:

Pre-2011: Resale forbidden

Until 2011, the FNMT not only charged private sector businesses for validation but also prohibited that third party multi-validators (e.g.: Tractis), willing to pay for the validations, could resell these to their final customers. The FNMT required instead that this third party (Tractis) submitted their clients to the FNMT so that FNMT could enter into a direct contract with the client, whereby that client had to pay a minimum of € 18,000 to the FNMT to begin to validate their certificates. Hardly acceptable conditions both for Tractis (prohibition of resale, need to give the client to the FNMT) and for potential clients (high cost).

Post-2011: High cost

In 2011 a complaint against the FNMT for these practices was lodged before Spain’s National Competition Commission (“Comisión Nacional de la Competencia” or “CNC”). The CNC mandated the FNMT to:

1. Open up their validation services to third party multi-validators, and
2. Offer different prices for wholesalers (third party multi-validators) and for the retail market (final clients).

In theory, the resale prohibition was gone. In practice, the cost of validation remained so high, even for the wholesale segment (€ 5.1 per validation for each one of the first 1,000 validations), that no client was willing to commit to this startup costs.

Why is Tractis supporting FNMT certificates now?

We found a client willing to take the annual fee required by FNMT.

Since the annual fee has been paid by the first customer, other Tractis customers can start enjoying FNMT support without having to pay annual fees to the FNMT, each separately and on their own.

Why is it better to get FNMT certificate validation from Tractis that directly with the FNMT?

Currently, Tractis is the only private sector oriented platform for identity verification and electronic signature, providing you with full FNMT certificate validation “out-of-the-box”, from the first minute, without the need for contracts, set-ups, annual fees or startup costs. Moreover, now that Tractis has become an FNMT wholesaler, contracting FNMT validation with Tractis lets you enjoy better economic terms than if you dealt directly with the FNMT:

• No annual fees: With Tractis you do not have to pay annual fees. If you contract directly with the FNMT, you must pay a fee of € 6,000 per year.
• Strict pay per use: With Tractis you do not have to buy a minimum number of validations per year. If you contract directly with the FNMT, you must purchase a minimum of 1,000 validations year, whether you use them or not.
• Better FNMT Rates today: Currently, in Tractis you pay € 0.36 for your first FNMT validation. If you contract directly with the FNMT, you will have to pay € 6 for every one of your first 1,000 validations.
• Better FNMT Rates tomorrow: For two reasons:
  1. Wholesale rates: At Tractis, we commit ourselves to apply, at all times, the FNMT wholesale market rates (our actual cost, without any markup) to the retail market. In other words, whatever your volume of FNMT validations, the price Tractis will give you will be always less than the price FNMT offers you directly.
  2. Cumulative total volume: Furthermore, Tractis prices will go down as our “total cumulative volume of FNMT validations for all Tractis clients” grows. In other words, you do not just get the Tractis wholesale price (not the FNMT retail price, see above), but also, when calculating the applicable FNMT Rate, we will consider the cumulative total volume reached by all Tractis customers (not just your individual volume). For example, if our cumulative total volume reached the upper price range (over 1 million queries per year), you would pay € 0.12 for your first FNMT validation, i.e., 3 times less than our current price, a 98 % discount on the FNMT starting price for the retail market (€ 6). If you deal directly with the FNMT, you will have to pay € 6 for every one of your first 1,000 validations.

We hope it was worth the wait.

By David Blanco
Saved in: Announcements, Business, eID, Tractis | 1 comment » | 11 November 2014