Consumer Attitudes Toward Online Banking

Released today at CashEdge's Client Conference: Innovation 2007, the study examined the online banking behavior and preferences of more than 400 consumers who use online banking functions.

For the second year in a row, consumers are telling us how much they value opening their accounts and conducting their ongoing banking business online. They continue to express a desire for more online capabilities and a willingness to switch institutions for more complete service offerings," stated Sanjeev Dheer, chief executive officer of CashEdge. "Consumers are still waiting for banks to deliver on the promise of their online channel. Banks that maximize their web presence are beginning to quantify the competitive advantage, and I believe we are nearing the point where banks that underutilize the online channel will experience a backlash."

The results of the second annual survey uncovered an unwavering consumer demand for online banking services. Among the study's most significant findings are:

• Moving Money Here, There and Everywhere - Eighty-seven percent of respondents have accounts at more than one institution and sixty-six percent of respondents said they would be "interested in transferring funds housed at different financial institutions." Additionally, nearly three-quarters (71 percent) would like to use online funds transfer for making payments to "other people/third party" instead of paying by check or cash.
• Show Me the Money... Now! - Seventy-four percent surveyed expect a new bank account to be available for use the same day (29 percent said they expect it to be available immediately), and twenty-seven percent of consumers are interested in real time/immediate funds transfer even if it involves an additional fee.
• Online More Popular Than Branches - The majority of respondents consider visiting their bank a "chore" (66 percent), 88 percent try to minimize bank visits, 65 percent reported a "high" to "very high" desire to ultimately move all of their banking and financial transactions online, and three-quarters (75 percent) say that if possible they would never go to the bank to conduct a financial transaction.
• Risk Perception - Forty-six percent cited security as a concern with online banking transactions of which fourteen percent report that their concerns keep them from banking online. CashEdge Risk Monitoring offers the industry's most comprehensive process for mitigating online banking risk by detecting fraudulent online transactions before they are executed, and identifying all related fraudulent activity through a sophisticated linked analysis. By leveraging CashEdge's expertise and ability to absorb risk, banks can eliminate the problem, as well as the perception.

Commissioned by CashEdge, the study polled more than 400 consumer "heads-of-household" nationwide who use online banking capabilities. These respondents described themselves as bank customers (79%), credit union members (18%) and customers of "direct/virtual banks" (3%).