Online Banking Adoption: Beyond the Tip of the Iceberg

November 14, 2002

Abstract

San Francisco, CA, USA November 14, 2002

Celent Communications predicts that if U.S. retail bankers apply best practices, online banking adoption will rise from 22% in 2002 to 38% by 2010.

In a new report, , Celent examines the factors driving online banking adoption in different countries (U.S., Finland, Norway, Sweden, and South Korea) and at select best-practice banks.

"While the dot-com party may be over, U.S. retail bankers are just beginning to celebrate their online banking accomplishments. With national adoption rates reaching 20% in North America, online banking is becoming a mainstream phenomenon. Twenty percent, however, is just the tip of the iceberg. Banks in Nordic countries and South Korea have pushed adoption beyond 35%," said Alenka Grealish, retail banking analyst at Celent and author of the report.

What are the best ways to boost adoption in the U.S.? The report identifies four critical areas: 1) engendering a supportive corporate culture, 2) combining bill pay and online banking, 3) offering superior education and support, and 4) galvanizing branch staff.  The report gives case studies illustrating how select banks have successfully accomplished these goals and seen subsequent improvements in online banking adoption rates.

"Two best practices jump out," says Grealish. "First, banks successful at generating activation have made bill pay the centerpiece of their online banking offering溶ot an add-on service. Second, banks successful at tapping the mainstream are focusing significant resources on educating and galvanizing their branch staff. For newcomers to online banking, encouragement and explanation by a branch staff has proven to tip the scales from awareness to action."

Best-Practice Case Studies in Online Adoption

Engendering a supportive corporate culture Marrying bill payment and online banking
  • FleetBoston
  • BankAtlantic
  • AmSouth
  • Nordea (Nordic bank)
  • United Cooperative Bank
Galvanizing the branch Offering superior education and support
  • Keycorp
  • Wachovia
  • The Royal Bank of Scotland
  • Digital Credit Union
Source: Celent Communications

A is available online.

of Celent Communications' Retail Banking research service can download the report electronically by clicking on the icon to the left.

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 subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

 

  San Francisco, CA, USA November 14, 2002

Online Banking Adoption: Beyond the Tip of the Iceberg

Return to report Abstract

 

EXECUTIVE SUMMARY 3
WHY ADOPTION MATTERS 5
DISPARITIES IN ONLINE BANKING ADOPTION ACROSS COUNTRIES 9
  Nordic Countries: The Iceberg 11
  South Korea: Sliding Down the Iceberg 14
  U.S.: At the Tip of the Iceberg 16
MOVING BEYOND THE TIP OF THE ICEBERG: CASE STUDIES 18
  The Alchemy 19
  Engendering a Supportive Corporate Culture 21
  Marrying Bill Payment and Online Banking 24
  Offering Superior Education and Support 30
  Galvanizing Branch Staff 34
CONCLUSION 39
APPENDIX 41

 

        

 

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