Virtual Banking

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get financial services when and where they wish...this means
anywhere, at any time." Statistics show that ATM's, telephone banking, and home
banking account for over fifty percent of all banking transactions today, and
total non-branch activity is growing at fifteen percent a year. In one survey
(Web-Tech, Inc., May 17, 1995), eighty-two percent of 18- to 34-year olds polled
preferred banks with 24-hour service.

Customers are also demanding a more sophisticated mix of products
tailored specifically to their financial needs, and non-bank competitors are
better fulfilling these needs. Banks today hold only 20% of household financial
assets, versus 34% twenty years ago; they have 30% of business deposits, versus
42% only seven years ago. Nonbank credit card providers have gained inroads
against banks, holding a 25% market share versus 5% in 1986 (WebTech, Inc., May
17, 1995).

Internet banking offers an attractive solution to this redesigned products and
services. Customers have ...

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customers dial into with their modems. Most likely Internet users
will continue to be charged for the size of the "pipe" connecting them to the
Internet.

The number of commercial entities with an Internet presence doubled in the first
three months of 1995. Modems will keep getting faster, allowing more information,
better graphics, and full-motion video to be downloaded more easily. However, in
five years most households will probably buy their Internet access from their
cable company, who will provide them with a 10 megabit-per-second connection
through their cable wire. A 10-MB connection would download in one second a file
that takes a 28.8K modem five and a half minutes to download ...

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