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Banks could save by changing channels A new report issued by Javelin has shown the banking industry can save nearly $8.3 billion if they convert non-online customers to online services. avelin, Europe’s leading specialist firm of retail and ecommerce consultants, suggest the key is to deepen customers’ use of online facilities. The strategy and research report undertaken (‘2010 Online Banking and Bill Payment Forecast: How to Cut $8.3 billion in Costs through Channel Conversion’) found that by converting customers to online banking and bill pay, a saving of $167 per customer could be made. Furthermore, by convincing current onlinebanking customers to use customer services online rather than through call centers or branches, banks could save $8 per customer. The report is based on data collected online from a random-sample panel of 5211 households in March 2010, which was representative of the overall U.S. online population. It has shown that approximately seven out of ten households pay their bills online through banks and billers. However, more regular billpayers show a preference for paying more types of bills through banks rather than at a biller site. Bank of America and Citibank have a higher proportion of customers who regularly view bills online, with U.S. Bank and JP Morgan Chase right behind.
Online banking is expected to increase in relevance as consumers’ expectations for always-on, real-time control grows and regulators put more pressure on financial institutions to provide more effective ways to help consumers monitor and manage their money, as well as producing technological innovations to make online banking simpler and more practical. President and Founder of Javelin, James Van Dyke, explained that online banking and bill pay are at a crossroads. “Financial Institutions and billers who do not want to stagnate must upgrade in order to entice more customers to bank and pay bills online. The issue is most acute for smaller regional and community banks, which lag far behind giant banks, larger regional banks and credit unions and have the most to gain by upgrading.” Other keys findings of the report were that onlinebanking customers own more financial products, presenting the opportunity for financial institutions to enhance customer relationships by cross-selling additional products. Additionally, Javelin found that household managers who bank with smaller regional banks and community banks are less likely to log in to online banking on a monthly basis and are more likely to pay bills by check.
Obama Boom? Although public companies have largely suffered during the recent economy, many have had reasons to stay positive since Obama became president.
The S&P 500 Index ($INX) is up approx. 35% since Inauguration Day.
Profits are expected to rise
36% in 2010/11.
Companies are sitting on a nearrecord $2 trillion in cash, money they could use to invest and create jobs.
Source: www.bloomberg.com
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