e-Corporate Banking in Europe

by Axel Pierron, January 3, 2003

Abstract

Paris, France January 3, 2003

During the past five years, European banks have invested heavily in online retail banking solutions; however, little has been done to develop the Internet for use by the corporate segment. In 2001, IT spending on retail banking in Europe exceeded €600 million, while only slightly more than €200 million was spent on the corporate side. This trend is changing. Investments in e-corporate banking solutions are predicted to grow by 200% by 2005, to €450 million.

Celent’s new report, , finds that as banks and corporations become more aware of the benefits of web-based cash management solutions, banks are increasingly offering more sophisticated solutions to this segment. By 2005, all major banks in Europe will provide specific features for corporate clients on their Web sites to supplement the existing balance inquiry and payment initiation features virtually all them already offer.

"Despite national and regional differences, European banks have, as a whole, have preferred to use their internal IT departments for deploying new e-corporate banking solutions" add analyst Axel Pierron, author of the report. " But this trend will change, and by 2004, outsourced development will represent more than 30% of deployments in e-corporate banking solutions".

"Although European businesses tend to use multiple banks, almost 50% of their data exchange occurs with their primary bank " says Axel Pierron. "Banks need to leverage the Internet in order to cement their relationships with leading corporate customers, and prevent them from going elsewhere"

The report examines the current states of e-corporate banking market in Europe. It analyzes the functionalities already available on banks’ corporate web site, the size of the market, banking revenue structure, and the existing factors affecting the corporate banking market. It also provides projections for adoption rates, future functionality, source of income and methods of deployments chosen by banks. The report concludes with key points for banks considering deploying new functionality within their corporate banking web-sites.

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Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned operating unit of Marsh & McLennan Companies [NYSE: MMC].

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Table of Contents

 

Paris, France January 3, 2003

Return to report Abstract

 

EXECUTIVE SUMMARY 3
INTRODUCTION 5
MARKET ANALYSIS 7
  Corporate Banking Web Site 7
  How Business Use Online Banking 10
  Factors Affecting Corporate Banking Now 12
TRENDS AND FORECAST 15
  New Services Generate New Income 15
  Changing Source of Revenue 19
  Benefits of New Services 21
  Businesses Want to Deal With Fewer Banks 22
METHODS OF DEPLOYMENT 24
  Build vs. Buy 24
  Criteria for Banks Evaluating Corporate Internet Banking Software 25
CONCLUSION 28

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