Citibank weaves a British web

IN THE US, online banking is well-established. Some banks even charge lower tariffs to their customers who do not visit branches.

Cheap internet access, and high home computer ownership in US households, has fuelled the growth of electronic banking there.

UK banks have been slower to see the value of the internet. Take-up has been driven by banks with less presence on the high street, including the Royal Bank of Scotland and the Co-operative Bank, as well as the Nationwide Building Society. Of the big four, only Barclays has a full internet banking service available to its customers.

Most banks here offer a limited range of services via their internet sites. Typically, customers can check balances online, but they can only pay bills if they arrange it first over the phone. They can review standing orders, but not set them up. They can transfer money, but usually only to accounts within the same bank.

The features that banks offer are the ones people use most of the time. However, the limitations are restrictive, especially to people who manage their finances in an active way.

However, last week Citibank launched its internet banking service in the UK. Citibank's previous PC banking service was one of the more comprehensive on the market, especially because of its support for money transfer and foreign currency transactions.

The internet version - which will gradually replace the PC banking product - takes this a step further. Citibank customers can use the web site to monitor savings accounts in 15 different currencies. They can transfer money to other Citibank account holders in Belgium, France, Germany, Greece, Luxemburg and Spain, and to accounts at any bank within the United Kingdom.

The bank plans to add more international options, and euro, US dollar and sterling account management and payment services over the next few months. Citibank also provides free telephone support, and a site that works for both Mac and PC users, or for people with Netscape or Microsoft browser software. It is currently giving away free internet accounts through a deal with VirginNet.

Citibank's internet operations reflect its approach as a bank. Effectively, it is branch-less, so the internet is a vital way for it to expand its operations. It is also a bank with a niche market: relatively well-paid people who travel frequently or who may have work or personal financial interests abroad. Access to a PC, at home or at work, is an issue for this group.

Citibank is also drawing on its background as a US-based bank. "We have more that 10 years experience with online banking which we built into this product and service," explains Alyson West, acting marketing director at Citibank in London. "We are committed to internet banking - giving customers features that they want and, therefore, making it easier and faster for customers to bank over the web."

Analysis in the United States shows that banks can save substantial amounts of money by persuading customers to use the internet instead of the branch networks.

Here, banks have been more sceptical, pointing to customer convenience rather than cost as the motive.

"Citibank is committed to the internet as another important banking channel that gives our customers the means to access and manage their finances - how and when they wish," says Ms West. "Internet banking adds another string to their bow when they are trying to save time in their busy schedules."

Citibank is not for everyone. The bank requires customers to prove a household income of pounds 30,000 a year.

The high street banks will not see customers defecting in droves, however good Citibank's package may be.

However, they would be unwise to ignore Citibank's web initiative altogether. Other banks, both in the US and Europe, will be watching its progress with interest.

They may well come to see the internet as a way to gain a foothold in the lucrative UK banking market.

Contacts: Citibank home page: www.citibank.co.uk

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

SThree: HR Benefits Manager

£40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...

Recruitment Genius: Office Manager / Financial Services

£30000 - £37000 per annum: Recruitment Genius: Established in 1999, a highly r...

Jemma Gent: Year End Accountant

£250-£300 Day Rate: Jemma Gent: Are you a qualified accountant with strong exp...

Jemma Gent: Management Accountant

£230 - £260 Day Rate: Jemma Gent: Do you want to stamp your footprint in histo...

Day In a Page

The difference between America and Israel? There isn’t one

The difference between America and Israel? There isn’t one

Netanyahu knows he can get away with anything in America, says Robert Fisk
Families clubbing together to build their own affordable accommodation

Do It Yourself approach to securing a new house

Community land trusts marking a new trend for taking the initiative away from developers
Head of WWF UK: We didn’t send Cameron to the Arctic to see green ideas freeze

David Nussbaum: We didn’t send Cameron to the Arctic to see green ideas freeze

The head of WWF UK remains sanguine despite the Government’s failure to live up to its pledges on the environment
Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Set in a mythologised 5th-century Britain, ‘The Buried Giant’ is a strange beast
With money, corruption and drugs, this monk fears Buddhism in Thailand is a ‘poisoned fruit’

Money, corruption and drugs

The monk who fears Buddhism in Thailand is a ‘poisoned fruit’
America's first slavery museum established at Django Unchained plantation - 150 years after slavery outlawed

150 years after it was outlawed...

... America's first slavery museum is established in Louisiana
Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

The first 'American Idol' winner on how she manages to remain her own woman – Jane Austen fascination and all
Tony Oursler on exploring our uneasy relationship with technology with his new show

You won't believe your eyes

Tony Oursler's new show explores our uneasy relationship with technology. He's one of a growing number of artists with that preoccupation
Ian Herbert: Peter Moores must go. He should never have been brought back to fail again

Moores must go. He should never have been brought back to fail again

The England coach leaves players to find solutions - which makes you wonder where he adds value, says Ian Herbert
War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn
Yvette Cooper: We can't lose the election. There's too much on the line

Yvette Cooper: We can't lose the election. There's too much on the line

The shadow Home Secretary on fighting radical Islam, protecting children, and why anyone in Labour who's thinking beyond May must 'sort themselves out'
A bad week for the Greens: Leader Natalie Bennett's 'car crash' radio interview is followed by Brighton council's failure to set a budget due to infighting

It's not easy being Green

After a bad week in which its leader had a public meltdown and its only city council couldn't agree on a budget vote, what next for the alternative party? It's over to Caroline Lucas to find out
Gorillas nearly missed: BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter

Gorillas nearly missed

BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter
Downton Abbey effect sees impoverished Italian nobles inspired to open their doors to paying guests for up to €650 a night

The Downton Abbey effect

Impoverished Italian nobles are opening their doors to paying guests, inspired by the TV drama
China's wild panda numbers have increased by 17% since 2003, new census reveals

China's wild panda numbers on the up

New census reveals 17% since 2003