Online banking growing fast - East Valley Tribune: Business

Online banking growing fast

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Posted: Thursday, June 17, 2004 11:27 am | Updated: 5:37 pm, Thu Oct 6, 2011.

June 17, 2004

NEW YORK - Millions of Americans are doing their banking online, and their ranks are expected to grow rapidly as more e-services become available and Internet connections get faster.

A study released Wednesday of online banking at the nation’s 10 largest financial institutions found that 22 million consumers logged in to their accounts in March, a nearly 30 percent increase from a year earlier.

Most went online to view their checking or savings account balances, the study showed.

But many were monitoring their credit cards, paying bills, managing credit lines or paying mortgages.

‘‘The banks are doing a lot of promotion of their services,’’ said Jim Larrison, head of the banking practice division at comScore Networks, which conducted the study.

‘‘The (online banking) leaders are also spending a lot of time and technology resources creating applications that are really user-friendly.’’

One of the main attractions of online banking is the 24-hour convenience. ‘‘I was traveling quite a bit and often away for quite a while, and I worried about keeping current,’’ said Diana Nichols, 73, who lives in San Francisco.

Nichols, who described herself as ‘‘not particularly computer literate,’’ said she set up her Bank of America online account so her bills would be paid

automatically.

ComScore said that Bank of America, based in Charlotte, N.C., remains the leader in attracting online banking customers while New Yorkbased Citibank has seen the strongest growth in the adoption of online bill paying.

Both banks ‘‘have focused internally, on their existing customers,’’ luring them from brick-and-mortar branches to the Internet, Larrison said.

Stand-alone Internet banks have not been as successful, he added, with the exception of ING Direct, which is based in Wilmington, Del. ‘‘They offer great savings products and pay great interest rates,’’ Larrison said, adding that the site makes it easy for consumers to transfer money among a variety of accounts.

Online banking use expanded more than tenfold from 1996 to 2003, Tower-Group Research said in a report last month. Tower-Group expects close to 37 percent of all U.S. households to be registered to bank online by 2007 — a total of 42.5 million households.

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