What Will Dominate the Home (1995)

Telephone, screen-phone, and PC banking are all gaining in popularity; TV banking is on the way. Each has its pros and cons Top Ten Most Commonly Asked Questions on the automated Easy Access line at Mid-State Bank, Arroyo Grande, Calif.: 10. What's the date today? 9. Se habla espanol? 8. Why is your balance always less than my balance? 7. Can you tell me what checks haven't cleared yet? 6. What are you doing with my money? 5. What is your closest office to Miami? 4. I don't have my checkbook with me, can you still give me my balance? 3. Why did my check bounce? 2. Does the man with that sexy voice work at the bank? (yes) 1. Are you open? Is this virtual banking or a Letterman routine? Potentially both. Semi-automated telephone banking service is probably the most established form of virtual, or remote, or nontraditional delivery of banking currently in use. Short of taking deposits and dispensing cash, there is little in the way of retail banking service that can't be--and isn't being--delivered to the home by one means or another. Even those limitations will likely disappear through the use of smart cards and electronic checks, as the following article points out. Mid-State customers are not alone in their enthusiasm for self-service, from-home banking. Nationally, 62% of consumers like the idea of being able to bank from home, according to a survey conducted by Mentis Corp., Salisbury, Md. more affluent a person is, the more likely he is to want to bank from home. Among those with incomes over $75,000, 78% look favorably upon home banking, whereas the percentage drops to 40% for people with incomes under $20,000. Anecdotal evidence suggests that the majority of these home-banking enthusiasts are dual-income-household professionals who live in cities. (But that's not universal, as you will see.) At-home momentum builds... competition is also providing access from home. Discount broker Charles Schwab's Street Smart software, which 100,000 people use, and Fidelity's Online Express, which has 40,000 users, let people access a checking account, get investment information, and buy and sell securities and mutual funds electronically. They are a significant threat to the banking industry, says Edward L. Neumann, senior consultant at Furash & Co., Washington, D.C. The only bank I know of that's meeting this challenge so far is Citibank. Citi offers 150 different banking and brokerage transactions by phone, screen phone, or personal computer. Fifteen million Americans manage their finances using Microsoft Money, Intuit's Quicken and Quickbooks, Block Financial's Managing Your Money (which is due to be acquired jointly by NationsBank, BankAmerica Corp., and perhaps other banks), and Computer Associates' Simply Money, according to Richard K. Crone, senior manager, Financial Services Consulting Practice at KPMG Peat Marwick. About 40% of all banks offer some kind of home banking service to their customers--be it through the ordinary telephone or such more exotic devices as screen phones and PC programs. Several banks are piloting TV banking as well. Why should home banking succeed now, when it's been attempted unsuccessfully for more than 20 years? difference, says Catherine Corby, is that now technology and communications companies are pushing their equipment into people's homes, and banks can inject their services into this equipment. In the past, when we tried to develop everything--the banking content, the technology, and other content--it just didn't work, says Corby, who is director of electronic banking strategy at Barnett Bank. Now we've got companies like Time Warner in a race with the telephone companies to control access to the home, and we have a chance to package our content to deliver over their channel. It's a totally different business proposition for us. …