Customer use of online banking still lacking
2010-08-10
A constantly growing number of bank customers are signing up for online banking services. But a new study finds that many of them aren't using these services as much as banks would like.

The survey by Mintel Comperemedia found that while 77 percent of adults with internet access have signed up for online banking, the amount of use varies greatly. Ten percent of respondents said that while they have signed up for online banking, they haven't actually used it.

"Despite the high penetration, banks are still eager to increase the usage of online banking," says Susan Wolfe, vice president of financial services at Mintel Comperemedia. "It's no secret that online banking creates deeper relationships between banks and customers, so banks are keen to pull in more users."

Younger consumers (aged 25-44) were much more likely to use online banking - with 79 percent of respondents saying they used the service.

Of those customers who did use online banking, the most common uses were to check account balances and transfer money, accounting for 93 and 65 percent of respondents, respectively. Another 38 percent used the internet to receive account alerts, and 30 percent used it to pay mortgages or credit cards that their financial institution had issued.

The report also says that 22 percent of online banking users have never used their banks to pay a bill online. In addition, 45 percent of internet users said that instead of using their bank's online bill payment services, they go directly to the biller's website instead. Because respondents said they received more than three online statements every month already, researchers said financial institutions that offer eBills could help banks increase that percentage and make a big impact on customer loyalty in banking.

"Offering eBills is a way for banks to ensure that customers continually return to their website and rely on the banks' services, rather than turning to other third-party sources," adds Susan Wolfe. "Consumers opt to pay bills on the biller's website because their statement is readily available. If banks provided the same thing, it could potentially increase consumer usage of online bill pay services."

Research has found that online bill payment has a significant effect in banks' efforts to reduce customer attrition. Earlier this year, a study by Fiserv found that consumers were 76 percent less likely to switch banks if they used online bill payment tools.

Recent Marketing Strategy and Planning News

Make Every Staff Member a Marketing Ambassador
2011-06-16
No matter what the business or how diversified its products and services, all employees need to act collectively toward the common goal of meeting customer needs and ultimately boosting profitability.
Targeted ads help FIs reward consumers
2011-03-07
Major financial institutions are adopting measures that both increase customer retention rates and improve revenues, and one way they are doing this is by partnering with marketers and companies.
Customers would desert online banking if it weren't free
2011-03-02
Major financial institutions enacted a customer loyalty coup when they hit upon online banking.

Recent Customer Attrition Retention, and Loyalty News

Two More Words on Client Retention
2011-06-23
For the past couple of months, PNT’s “Industry News” has focused on client retention.
Customer Acquisition and Client Retention: New Banking Regulations Bring Challenges and Opportunity
2011-06-16
Banks face customer exodus! The era of free checking is over! Debit Card interchange revenue to be slashed! New ATM charges loom!

These are among the headlines, somewhat sensationalized, being written about regulatory changes enacted as a part of the recent batch of financial reforms.
Bank Call Centers the Bedrock of Client Service: Retaining Clients One Call at a Time
2011-06-16
When TD Bank designed a new call center in Maine it emphasized a commitment to customer service by installing a 9-ton boulder amid the 60,000-square feet of office space.