Blog - Page 1282 of 1286

Bill Payment Pricing Research Results

By Jim Bruene Posted on August 2, 2004
Categories: Bill payment

In the U.S. market, the industry standard pricing model has been free online banking access combined with fee-based bill payment. However, during the past three years, the fees for bill payment have gradually gone away to the point where the most major U.S. banks advertise free bill payment, though it may not apply to all account types or balance levels. In July, we surveyed the top 50 U.S. banks and found only two that still charged a monthly fee to all bill payment customers. Nearly half, 22 of 50, offered bill payment free to everyone. Three banks did not offer bill payment and the remaining 23 offered it free for certain accounts and/or balance levels. In total, 45 of the 47 (96%) largest banks with bill payment offered a free option . For those charging a fee, the average listed price is $5.63/mo. Last fall, TowerGroup found 33…

The “Fee vs. Free” Controversy

By Jim Bruene Posted on August 1, 2004
Categories: Pricing

Free bill payment. It seems inevitable. With Bank of America and other U.S. mega-banks flogging free bill payment 24/7 , is it possible to still charge a fee and remain competitive? We believe you can and should charge bill payment fees to at least a portion of your online banking base. But you need to expand the list of features and benefits for the fee-based option to distinguish it from free services offered by other banks. Eventually, you will likely divide your online banking base into two or more segments. The FREE entry-level service receives the usual laundry list of online banking benefits. The premium level qualifies for an even longer list of benefits, most notably, pay-anyone bill payment. However, premium customers pay monthly fees ranging from $5 to $10 or annual fees in the $50 to $100 range The key to making this work is to get away from…

Bank of Ameria Wastes Site-Search Opportunity

By Jim Bruene Posted on July 23, 2004
Categories: Bank of America

Bank of America is the virtual poster child for online banking with some 11 million users and an award-winning website. However, after two years of intense advertising of its free bill-payment service along with more than $100 million in foregone fees,* you'd think a search on their site for "bill payment" would take you to a pitch for its online payment service. Well you'd be wrong. The first page of search results includes very helpful information on how to pay your credit card bill, but no mention of pay-anyone electronic bill payment or presentment. You have to click on See next 6 answers and go to the subsequent page to learn about online bill payment. Let this be a lesson to add one more task to your marketing project plans: Optimize site-search results *Assume 1 million users times $5/mo x 24 months.

Stockbroker Rankings from SmartMoney

By Jim Bruene Posted on July 12, 2004
Categories: Investment Products

SmartMoney just published its annual stock broker rankings (Note: currently the 2003 survey is posted, the 2004 should be there shortly). There are now two categories of discount brokers: Premium and Basic. THere was little movement in the premium category year over year other than Vanguard droping from second to sixth and E*Trade making its inagural entry at number 2. Last year it was ninth in the basic category. The best premium discount brokers: ____2004_________2003 1. Fidelity..........Fidelity 2. E*Trade.........Vanguard 3. Schwab..........Schwab 4. USAA.............Quick & Reilly 5. T. Rowe Price..USAA 6. Vanguard.......T. Rowe Price The basic category was more interesting with OptionsXpress coming out of nowhere to take the number one spot. SmartMoney's comment, "nearly flawless." _____2004____________2003 1. OptionsXpress.......TD Waterhouse 2. Muriel Siebert........Muriel Siebert 3. TD Waterhouse......Bidwell 4. Ameritrade............ScottTrade 5. HarrisDirect...........HarrisDirect 6. FirstTrade..............BrownCo 7. ScottTrade.............FirstTrade 8. Wall Street Access...Ameritrade 9. BrownCo................E*Trade (moved to premium) 10. WallStreet*E.........Wells Fargo (moved to premium)

Widespread Misuse of Gartner Online Banking Fraud Estimates

By Jim Bruene Posted on June 16, 2004
Categories: Security & Privacy

By now you've probably seen the MSNBC report by Bob Sullivan entitled, Survey: 2 million bank accounts robbed, followed by the subhead, Criminals taking advantage of online banking, Gartner says. The MSNBC article seems to say that 2 million U.S. consumers lost money from their checking accounts due to online banking. In fact, here is what Gartner actually says in its report: "Illegal access to checking accounts is the fastest-growing type of consumer fraud, and may be proliferating through online channels." (italics are mine) The report goes on to say that most consumers do not know how they theft occured, only 17% believed that their info was stolen off the Internet, another 10% reported their wallet was stolen, and only 5% recall giving up personal info to phishers. Gartner also says that 70% of the online consumers reporting losses also report that they banked or paid bills online, "which exposes…

Phishers Target the Royal Bank

By Jim Bruene Posted on June 15, 2004
Categories: Security & Privacy

Phishers struck another blow to the banking system when they demonstrated that they no longer need rely on random blanket emailing blasts. Case in point: within 24 hours of a real systems glitch at Royal Bank, the email thieves sent a massive fraudulent email playing off the legitimate systems outage. One can only hope that this particular theft didn't enrich the thieves. Otherwise you have a situation where there is an incentive for a thief to create havoc with a bank's systems and then cash in through a well-timed phishing fraud. Read more on the prevention of phishing at Online Banking Report (subscription required).

Washington Mutual Small Business Resource Center

By Jim Bruene Posted on June 12, 2004
Categories: Innovations, Washington Mutual

Although not as robust as Barclays, Washington Mutual is the only top-10 U.S. bank with prominently targeting startups. Through its partnership with StartupNation, the bank has posted several articles on its website, and also sends users to a cobranded www.StartupNation.com website to sign on for more tools and resources including webinars, resources, and coaching. We don’t know the terms of the relationship, so we can’t judge the cost effectiveness. However, we definitely like how WAMU is positioning itself as a supporter of small business.

Top 10 Financial Services Providers by Small Business Market Penetration

By Jim Bruene Posted on June 11, 2004
Categories: Small Business

In the 2002 study of small business, TNS (formerly NFO Global Financial Services) looked at which banks had the largest share of small businesses relationships and which were ranked highest by small business clients. SunTrust ranked highest in customer loyalty, followed by Wachovia and Washington Mutual. 1. Bank of America Pros: · Three levels of business online banking: online banking with bill pay, Business Connect for multi-users with varied levels of access, and Bank of America Direct to manage all business finances online. · Good comparison chart of the three choices · Resource center with informative articles on starting a business and other topics · Protect against online fraud link Cons: · Must scroll down to see all choices · Hard-to-read small blue font for most links · No separate URL or bookmark helper 2. Wells Fargo Pros: · Small business tab · Excellent navigation and design,…

Innovators in Small Business Online Delivery

By Jim Bruene Posted on June 10, 2004
Categories: Barclays, Innovations, NetBank, PNC Bank

Innovators in small business online delivery Table 55 Watchfire/Gomez Small Business Scorecard Rank Name Score Dec ‘03 Number Sm. Biz Clients 1 (tie) Bank of America 7.6 2.5 mil1 1 (tie) National City 7.6 ina 3 (tie) Key 6.9 ina 3 (tie) Wells Fargo 6.9 1.3 mil2 5 (tie) Chase 6.8 300,0001 5 (tie) Fleet 6.8 450,0002 5 (tie) Wachovia 6.8 800,0001 8 Bank One 6.6 ina 9 (tie) HSBC America 6.0 ina 9 (tie) U.S. Bank 6.0 ina Source: Watchfire, 6/04 <gomezpro.watchfire.com> Other banks evaluated, but not making the top 10: Bank of New York, BB&T, Citibank, Citizens Bank, Comerica, Fifth Third Bank (150,000 clients), LaSalle, PNC Bank (200,000 clients), SunTrust, UBOC, Washington Mutual (250,000 clients) 1American Banker, May 18, 2004, BofA total includes FleetBoston 2American Banker, Oct. 1, 2003 Our first report on small business banking was produced in the fall of 1997 (OBR 29). At that…

Small Business Case Studies: Putting it all Together

By Jim Bruene Posted on June 9, 2004
Categories: Small Business

Case Study: Financial product usage at one small business Microbusinesses typically purchase a hodgepodge of services culled from both retail and commercial banking product lines. For example, at our own small business, we purchase 16 financial products evenly split between consumer and business products (see Table 52, below). Nine are sourced from banks, six are from non-banks, and one is a combined effort. Overall, we spend $6,700 annually in fees, interest paid, and interest foregone (for checking). But the internal costs for managing our billings, payments, and banking, are more than three times as much, an estimated $24,000 per year. We would gladly outsource these to a high-quality and VERY trustworthy third party, preferably someone with a regulatory and fiduciary responsibility to safeguard our information and assets, like a bank. Table 52 Financial Products & Services Used by One Small Business Source: Online Banking Report, 6/04 1Fees and net interest…

Recommended Online Products and Services for Micro Businesses

By Jim Bruene Posted on June 8, 2004
Categories: Small Business

Small business attitudes are changing as online banking services become easier to navigate and more useful. While it currently seems impossible to eliminate the dependence on the branch for physical deposits, with the widespread adoption of check imaging and electronic payments, most non-cash-oriented businesses will be able to bank remotely. Both PNC Bank and NetBank have announced plans to equip their business customers with paper check scanners that will allow the remote deposit of paper checks. But even the best website and product offering cannot substitute entirely for the human touch. Every business should have a contact available by phone, email, or instant message. Small business owners should be treated like private banking clients. Recommended online products and services In theory, small and micro businesses represent one of the most lucrative, and relatively untapped, sources of incremental business. The reality is that businesses are difficult to reach unless you are…

Small Business Online Banking Usage

By Jim Bruene Posted on June 7, 2004
Categories: Small Business

Online banking usage Up until a few years ago, small business usage of online banking trailed consumer adoption. In late 2000, 13% of small and microbusinesses used online banking compared to 16% of consumers . Three years later, online banking penetration is similar to that of consumers, an estimated 30% overall. At the largest small businesses, those with sales between $5 and $10 million, usage is now more than 40%, double the rate three years earlier. It’s likely we’ll see continued rapid growth for a few more years. Almost all (99%) small businesses are computerized, either at the business or at the owner’s home, or both (see Table 18, above) and more than 75% are using their personal computers for financial activity (see Table 21, next page). It’s only a matter of time before the majority of small businesses bank online. Looking at the 7.3 million small and microbusinesses universe,…