Online Banking Catching On

Mercer Business, Apr 01, 2002 by Lamberg, Erica

Online banking systems allow consumer and business customers to plug into a host of banking services from a personal computer by connecting with the bank's computers or by connecting through a bank's website.

The convenience is compelling and not only is travel time to branches reduced, but ATM machines and telephone banking are often unnecessary. And, as technology continues to develop, it makes online banking easier for the average consumer.

Banks use a variety of names for online banking services, such as PC banking, home banking, electronic banking or Internet banking. Regardless of the name, these systems offer certain advantages over traditional banking methods.

According to Bob Kline, e-commerce relationship manager with Sovereign Bank, banks like Sovereign (www.sovereignbank.com) are beefing up their Internet banking to stay competitive in the marketplace.

"It's really a retention issue and a competitive issue for us," said Kline. "Although we are not aggressively marketing the net banking programs currently, we are in the process of formalizing a strategy to marketing our online services."

Sovereign Bank's electronic banking options include their NetBanking product which allows customers to check balances, see account history, transfer funds between accounts, and much more.

Another service available with Sovereign is BillPay which eliminates writing checks, buying stamps or trips to the mailbox. A customer can pay bills at any time from any computer with access to the Internet, and a secure browser, to anyone with a standard United States postal address.

Furthermore, Credit Card Access at Sovereign Bank is available to access credit card account information, pay a credit card bill online, and download transactions. After a customers enrolls they are able to use it anytime from any PC.

Local banking executives concur that online banking is rapidly gaining consumer acceptance. A major factor affecting the acceptance of online banking is the availability of easy-use and reliable transaction security systems.

One of the biggest concerns about online consumer banking has always been the security of the systems and the integrity of transaction data. While security remains a major issue for both the bank and its customers, there are solutions that are cost-effective and permit an unprecedented degree of security, reliability and protection from misuse.

Currently, Sun National Bank has seven branches in Mercer County and will be opening two more branches in Mercer County by the end of April. According to John Hancq, vice president of cash management, Sun National Bank maintains three levels of security enscriptions for its website (www.sunnb.com).

"There is use password protection, firewall protection security and aspects of the application process that need to be completed via the mail not just online," Hancq said.

As a community bank, Hancq explained that Sun National Bank's goal is to provide a choice of services for customers. To that end, a customer can opt for loanable software on their PC, or opt to sign on directly over the Internet.

"We understand our customers needs and we react to them," he added. Sun National Bank provides customers with online account statements, account summaries and cleared check information.

Commerce Bank, currently with five Mercer County branches will be opening three more in Mercer County. Commerce also has a comprehensive list of online banking services.

According to David Flaherty, vice president of corporate communications, Commerce Bank was a pioneer in the online banking industry.

"Early on Commerce entered the online banking arena and we've set the pace for this emerging industry," says Flaherty. He attributes Commerce's success with understanding their customers' needs. "While other banks use online banking to cut costs, Commerce uses it to serve the needs of our customers better."

Online customers take advantage of Commerce Bank's service through the website (www.CommerceOnline.com). Services of checking balances, account reviews and transferring of funds between accounts are among the most popular services, notes Flaherty.

Additionally, though a Commerce Capital Markets subsidiary, Commerce is able to provide on-line stock trading and research services that are fully integrated within their website. Benefits include buying and selling stocks for just $25 per trade; tracking performance of an investment portfolio, and accessing research on industries and specific companies. "The stock trading component of our website is extremely popular," noted Flaherty.

In addition to consumer online services, banks are reaching out to business customers as well.

Commerce Bank offers TreasuryDirect which enables a company with fast and efficient information to make sound cash management decisions. Some other online services available for business customers include information reporting, check imaging, automated clearing house, wire transfer and stop payment capabilities. Businesses are also able to send wire transfers, and manage cash disbursements and fees.