Retail Internet Banking Vendors: Shifting Gears to Optimize the Online Channel

 Jacob Jegher, January 9, 2009
Vendor Reviews
North America


San Francisco, CA, USA January 9, 2009

Retail Internet Banking Vendors: Shifting Gears to Optimize the Online Channel 

As the year comes to a close, the banking industry can now claim over 46 million US households banking online, a 7% increase over 2007. This represents 41% of all US households and 67% US households in the addressable market (of banked consumers that use the Internet). As the rate of Internet banking adoption levels out, banks are looking to increase the effectiveness of their Internet banking offerings, both on a stand-alone basis and within the bank’s broader channel strategy.

For nearly 15 years, banks have pursued customer service and sales in the Internet channel. Over the last 18 months, leading banks and vendors have been shoring up their platforms to address gaps in features and functions, increase overall usability, and increase system agility. What has been most interesting in this period is the growing emphasis placed on increasing the effectiveness of the Internet channel. Banks are seeking to optimize the online experience to drive customer acquisition and cross-sales and increase use of relationship building services, while also decreasing their costs to sell and serve. Although the vendor community was hard at work during this period, the fruits of their labor will not be fully realized for some time.

This report examines 12 retail Internet banking offerings across 10 providers: CheckFree, now part of Fiserv, Inc., Digital Insight, an Inuit Company, Fidelity National Information Services, Inc., Harland Financial Solutions, Information Technology, Inc., another Fiserv connection, Metavante, Online Resources, Open Solutions, Inc., Q2 Software, Inc., S1 Enterprise, a division of S1 Corporation, S1 Postilion, a division of S1 Corporation and Sybase Financial Fusion. This is the first year Harland Financial Solutions and Q2 Software have been included in the vendor review.

Celent’s last review of Internet banking vendors was in February 2007. For the third time in a row, CheckFree (which acquired Corillian in 2007 and is now part of Fiserv) stands out as the clear leader, with Digital Insight (now part of Intuit) again finishing in the top three. Metavante continued its strong advance and finds itself in the number two position, and for the second time, among the top 3 providers. Online Resources, S1 Enterprise and Fidelity National advanced their offerings over the past 18 months and again scored well.

"It’s easy to see that many solutions in the market are acceptable based on how the industry has looked at the Internet channel in the past. As banks seek to optimize the potential of the channel, the expectations of solution providers increases," says Edward Woods, senior analyst with Celent’s Banking Group and author of the report.

"Banks that look at Internet banking strategically won’t just run to the lowest cost solution. If it doesn’t meet the bank’s customer acquisition, customer retention and cross-sell goals, it’s time to look at alternatives," he adds.

The report begins with review of the 12 solutions’ market positioning in relation to target markets served and provider size. The next sections provide an evaluation of the vendors along the ABCD Vendor View dimensions as well as additional analysis.

Celent's ABCD Vendor View is a standard representation of a vendor marketplace designed to show the relative positions of each vendor in four categories: Advanced technology, Breadth of functionality, Customer base, and Depth of client services. Unlike a simple "four-quadrant" map, solutions in the upper right are not necessarily the best solutions-there is no one "best" for all cases. Banks should consider which factors in breadth, technology, experience, and client service are most important to them and use the analysis provided in this report to generate their own shortlists.

The 62-page report contains 12 solution profiles, 17 figures, and 20 tables. A table of contents is available online.

of Celent's Retail and Business Banking research service can download the report electronically by clicking on the icon to the left. Non-members should contact for more information.  

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].

Media Contacts

North America
Michele Pace
Tel: +1 212 345 1366

Europe (London)
Chris Williams
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
Tel.: +81 3 3500 3023

Table of Contents

San Francisco, CA, USA January 9, 2009

Retail Internet Banking Vendors: Shifting Gears to Optimize the Online Channel


Executive Summary 3
Taxonomy of Vendors 5
Celent's ABCD Vendor View Analysis 10
Profiles 22
Conclusion 58


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