Electronic commerce: Banks go from high street to high bandwidth Coaxing customers on to the Internet takes a combination of easy accessibility and tight security, says Mark Vernon

Banks are cosying up to their customers, and the Internet is proving to be the ideal way of doing it. Last week the Co-operative Bank unveiled its new online service as it joined the handful of UK institutions already offering PC or Web-based banking. It will not be long before access to accounts, transactions and purchasing are offered as standard by all the high street names. Which is timely, because as this industry undergoes its very own cultural revolution, everyone will find their banking experience, offered or received, changing beyond recognition.

Only three banks currently offer full Web-banking services, defined as operating over the Internet rather than via a direct dial connection: Nationwide, the Royal Bank of Scotland and now the Co-operative Bank. This compares to more than 10 in Germany, to say nothing of the number in the United States. But it is clear that these are just the leaders in the trend to move online. A number of other firms, including the Bank of Scotland, Barclays and NatWest offer home banking services, in part as a confidence-gaining prelude before transferring to the Internet.

However they reach you, a common feature of all the sites is how different they are from what might traditionally be expected. Long gone are the days of columned facades opening up into marble-floored halls at the end of which stood a black- suited teller. Intimidation is out and intimacy is in. For example, the Nationwide site (http://www.nationwide.co.uk) includes comprehensive coverage of the Nationwide Football League. Similarly, Barclays PC banking includes links to additional services such as Argos, Interflora and Eurostar, on (http://www.barclays.co.uk) via Microsoft's Money 97 software.

Even banks that have yet to launch similar kinds of operations are all working on their interactivity with imaginative schemes. Lloyds, for example, has a page for connecting home workers to one another (http:// www.homeworker.co.uk).

Meanwhile, the Co-operative Bank has done its bit to the changing face of the industry. "For users inhibited by the 'techy' environment of the Web," the press release reads, "the Co-operative Bank interface is designed to provide a refreshing change." And it is true that gone is the flat, menu-based look of traditional online banking forms in favour of a console- like interface, looking not unlike a Nintendo Game Boy, with the idea that details are presented in a familiar, easily accessible framework.

Entranet, the company that designed the Co-operative Bank's site, is already known for its well-developed philosophy. "Electronic commerce should achieve two things: lowering cost and accelerating trade," explains Nick Spooner, who works for Entranet and was trained by Steve Jobs of Apple fame. "The customer should feel in control, but the machine should do most of the work." If they are to achieve this, sites need to be bullet- proof, he says, not so much from the threat of hackers as the uncertainties of the user.

Too many sites, he argues, shy away from this less tangible issue, though it shows itself up in obvious ways, as when pages do not have a consistent look and feel to them. This is not good enough, especially when it comes to financial sites. "Consistency is comfort. The slightest amount of discomfort leads to prejudice [about the Internet], and that leads to distrust."

"Co-operative comfort" is the hook upon which the new site is hung, and it is something to which all banks should become attached. "Retail has been doing this for years," Spooner says. "If it is easy to use, it is easy to buy." For banks, this disquieting message is coming from more than one direction. Witness the rise of the supermarket bank; cheque in at the check-out.

Indeed, all electronic commerce on the Internet should be like this. It is only in this way that it will be possible to break what might be called the "cycle of complaint" - ie, even if people trust security measures, they find problems with a system's use and so on, out of a general fear of the new medium.

But the Co-operative Bank is taking no chances with the nightmare that steals the headlines. It happened to the Royal Bank of Scotland, which last year, weeks after a triumphant launch as the UK's first fully-fledged Internet banking service, saw a breach in its fire walls courtesy of the self-styled Chaos Club from Hamburg. Although there was no real threat to customers, the PR damage was done.

The Co-operative Bank's systems have been rigorously tested. In a move explicitly designed to reassure customers, all users must register a Security Pass Code and Secure Personal Information (SPI) with the bank via a telephone call prior to using the service for the first time. The SPI will consist of five pieces of memorable information known only to the account holder. Internet users will be asked to confirm any one of the five SPI items plus their unique Security Pass Code each time they use the online service. Failure to do so will abort the Internet access and the customer will be asked to contact the bank by telephone.

Mervyn Pedelty, chief executive, comments: "This system is best-of-breed and we are confident of its security. However, we appreciate that there have been security problems surrounding the Internet in the past and that is why we have built in the extra safeguard of speaking to customers before they use the service."

You might call it "safer banking", reminiscent of other forms of intimacy in the late Nineties.

Arts and Entertainment
Blackman: Landscape of children’s literature does not reflect the cultural diversity of young people
booksMalorie Blackman appeals for a better ethnic mix of authors and characters and the illustrator Quentin Blake comes to the rescue
Arts and Entertainment
'Eminem's recovery from substance abuse has made him a more potent performer, with physical charisma and energy he never had before'
musicReview: Wembley Stadium ***
Arts and Entertainment
‘Dawn of Planet of the Apes’ also looks set for success in the Chinese market

film
News
Arts and Entertainment
The successful ITV drama Broadchurch starring David Tenant and Olivia Coleman came to an end tonight

tv
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Arts and Entertainment
Chocolat author Joanne Harris has spoken about the financial struggles most authors face

books
Arts and Entertainment
A scene from How To Train Your Dragon 2

Review: Imaginative storytelling returns with vigour

film
Arts and Entertainment
Josh Hutcherson, Donald Sutherland and Jena Malone in Mockinjay: Part 1

film
Arts and Entertainment

film
Arts and Entertainment
Characters in the new series are based on real people, say its creators, unlike Arya and Clegane the Dog in ‘Game of Thrones’
tv
Arts and Entertainment
A waxwork of Jane Austen has been unveiled at The Jane Austen Centre in Bath

books
Arts and Entertainment
Britney Spears has been caught singing without Auto-Tune

music
Arts and Entertainment
Unless films such as Guardians of the Galaxy, pictured, can buck the trend, this summer could be the first in 13 years that not a single Hollywood blockbuster takes $300m

tv
Arts and Entertainment
Miley Cyrus has her magic LSD brain stolen in this crazy video produced with The Flaming Lips

music
Arts and Entertainment
Gay icons: Sesame Street's Bert (right) and Ernie

tv
Arts and Entertainment
Singer Robin Thicke and actress Paula Patton

music
Arts and Entertainment
The new film will be shot in the same studios as the Harry Potter films

books
Arts and Entertainment
Duncan Bannatyne left school at 15 and was still penniless at 29

Bannatyne leaves Dragon's Den

TV
Arts and Entertainment
The French economist Thomas Piketty wrote that global inequality has worsened

books
Arts and Entertainment
David Tennant and Benedict Cumberbatch

TV
Arts and Entertainment
Ben Affleck plays a despondent Nick Dunne in David Fincher's 'Gone Girl'

film
Arts and Entertainment
Pete Doherty (L) and Carl Barât look at the scene as people begin to be crushed

music
Arts and Entertainment

tv
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Have you tried new the Independent Digital Edition apps?

ES Rentals

    Independent Dating
    and  

    By clicking 'Search' you
    are agreeing to our
    Terms of Use.

    Super Mario crushes the Messi dream as Germany win the 2014 World Cup in Brazil

    Super Mario crushes the Messi dream

    Germany win the 2014 World Cup in Brazil
    Saharan remains may be evidence of the first race war, 13,000 years ago

    The first race war, 13,000 years ago?

    Saharan remains may be evidence of oldest large-scale armed conflict
    Scientists find early warning system for Alzheimer’s

    Scientists find early warning system for Alzheimer’s

    Researchers hope eye tests can spot ‘biomarkers’ of the disease
    Sex, controversy and schoolgirl schtick

    Meet Japan's AKB48

    Pop, sex and schoolgirl schtick make for controversial success
    Iraq crisis: How Saudi Arabia helped Isis take over the north of the country

    How Saudi Arabia helped Isis take over northern Iraq

    A speech by an ex-MI6 boss hints at a plan going back over a decade. In some areas, being Shia is akin to being a Jew in Nazi Germany, says Patrick Cockburn
    The evolution of Andy Serkis: First Gollum, then King Kong - now the actor is swinging through the trees in Dawn of the Planet of the Apes

    The evolution of Andy Serkis

    First Gollum, then King Kong - now the actor is swinging through the trees in Dawn of the Planet of the Apes
    You thought 'Benefits Street' was controversial: Follow-up documentary 'Immigrant Street' has got locals worried

    You thought 'Benefits Street' was controversial...

    Follow-up documentary 'Immigrant Street' has got locals worried
    Refugee children from Central America let down by Washington's high ideals

    Refugee children let down by Washington's high ideals

    Democrats and Republicans refuse to set aside their differences to cope with the influx of desperate Central Americas, says Rupert Cornwell
    Children's books are too white, says Laureate

    Children's books are too white, says Laureate

    Malorie Blackman appeals for a better ethnic mix of authors and characters and the illustrator Quentin Blake comes to the rescue
    Blackest is the new black: Scientists have developed a material so dark that you can't see it...

    Blackest is the new black

    Scientists have developed a material so dark that you can't see it...
    Matthew Barzun: America's diplomatic dude

    Matthew Barzun: America's diplomatic dude

    The US Ambassador to London holds 'jeans and beer' gigs at his official residence – it's all part of the job, he tells Chris Green
    Meet the Quantified Selfers: From heart rates to happiness, there is little this fast-growing, self-tracking community won't monitor

    Meet the 'Quantified Selfers'

    From heart rates to happiness, there is little this fast-growing, self-tracking community won't monitor
    Madani Younis: Five-star reviews are just the opening act for British theatre's first non-white artistic director

    Five-star reviews are just the opening act for British theatre's first non-white artistic director

    Madani Younis wants the neighbourhood to follow his work as closely as his audiences do
    Mrs Brown and her boys: are they having a laugh?

    Mrs Brown and her boys: are they having a laugh?

    When it comes to national stereotyping, the Irish – among others – know it can pay to play up to outsiders' expectations, says DJ Taylor