Finovate Blog

Table 1 Online Banking Timeline number of U.S. households using online banking/bill payment Source: Online Banking Report estimates based on industry data plus or minus 15%, 12/03  Every spreadsheet and business plan needs a prediction of future demand. So every year we gather forecasts made by prominent researchers and analysts, compare and contrast their results, layer on our own insights, and develop a 10-year forecast. Accuracy is estimated at plus or minus 15% for years one through three, plus or minus 20% for years four through seven, and plus or minus 25% for the out-years. Over the years we’ve demonstrated a respectable track record . Our first comprehensive forecast made six years ago (year-end 1997), predicted that online banking usage would increase nearly 6-fold (560%) from 4.5 million in 1997 to 29 million households by year-end 2003. That prediction was nearly dead-on, perhaps 10% low, with an estimated 29 to…

Read more →

  To many long-time bankers, online banking hadn’t proved its worth prior to 2003. However, with usage surpassing 30% of all U.S. households, and with leaders such as Bank of America pushing past 40%, even the skeptics are beginning to recognize the potential. By the end of the decade, total U.S. penetration is expected to approach 50%. Unlike many new technologies, online banking delivers on three levels: improved customer satisfaction, increased sales, and cost savings. Now that these institutional benefits have actually been documented, the rest of the decade promises to see an extraordinary build-out of online capabilities, much like the explosion of ATMs in the late 1980s as the channel became profitable. Looking back at the last year, three changes stand out: The onslaught of email spam and scams causing short-term headaches and long-term credibility problems. The change in U.S. press coverage from somewhat negative to very positive (except…

Read more →