Abbey to invest pounds 100m in Net & TV banking

ABBEY NATIONAL, the retail bank, yesterday announced plans to invest pounds 100m to develop Internet and interactive television banking over the next three years.

Andrew Pople, Abbey's head of retail banking, said the bank saw even greater potential in interactive television banking than in the Internet, particularly in the middle-market sector where Abbey sees its natural customer base. The bank, which yesterday announced profits for the year of pounds 748m, a rise of 17 per cent, is also planning to launch a Net brand with its own identity, although it has yet to settle on a name. "This is a global first. It is going to be absolutely huge," Mr Pople said. "It is estimated there will 65 million users of interactive TV in Europe by 2005. "This gives us a real opportunity to get into a revolutionary leading edge technology at a very early stage."

Abbey is plunging headlong into TV banking. It is one of two banks that have signed up with Sky's digital interactive shopping platform Open which launches in the UK in September. The other is HSBC. The system allows customers to switch using their handset from watching mainstream television to the interactive channel allowing them to pay their bills or check account balances during commercial breaks. Initially customers will have to resort to the telephone if they want to do more sophisticated transactions, but the aim is to allow the to be done through the TV within months.

Abbey, led by chief executive Ian Harley, plans to use interactive television for the main thrust of its e-commerce strategy, with a separate Internet platform targeting a more selective customer base. The bank said that branch use has fallen by 30 per cent over two years as customers switched transactions to the telephone and cash dispensers. But Abbey insists that cost is not the only factor.

Lord Tugendhat, the bank's chairman said: "People will be able to access the bank by which ever means they feel most comfortable with."