TITLE

Diverse players build banks online

AUTHOR(S)
Cardona, Mercedes M.
PUB. DATE
August 1999
SOURCE
Advertising Age;8/2/1999, Vol. 70 Issue 32, p32
SOURCE TYPE
Trade Publication
DOC. TYPE
Article
ABSTRACT
This article reports on the move by credit-card companies and electronic stock brokerages in the U.S. to launch online banks, as of August 1999. In July 1999, American Express Co. and Bank One's First USA both launched online banks. Also, ETrade, an online brokerage in the U.S., announced a deal to buy Telebanc Financial Corp. According to Forrester Research, only 11.9 percent of 28.6 million wired U.S. households banked online in 1998. But the number of households banking online is expected to jump from 3.4 million in 1998 to 18.5 million by 2003 as consumers become comfortable carrying out transactions on the Web. Already, two cyberbank models have emerged: In one, established financial companies trade on their name or, in the other, establish what appears to be a maverick start-up. Credit card companies have the advantage of experience in using direct mail, testing offers and analyzing results. According to Michael Weiksner, manager of finance strategies at Cyber Dialogue, online banking has been around since the early 1980s, mainly in the form of dial-up software to let customers perform simple functions. He also said that for banks, online banking is an extra cost.
ACCESSION #
2109375

 

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