Spreading its marketing wings in cyberspace, Citibank announced Monday that its computerized home banking services are available through Prodigy.
The bank's customers in the New York area can use the commerical on-line service to view account information, pay bills, and buy or sell stocks via their personal computers. In keeping with Citibank's aggressive approach to pricing (see page 6), the banking service will cost Prodigy users nothing beyond what they pay for basic network access.
Prodigy, which is owned by International Business Machines Corp. and Sears, Roebuck and Co., is the smallest of the three major on-line networks, with about two million PC-owning subscribers. But it claims more bank participants than America Online or H&R Block's Compuserve, which each exceed four million subscribers.
Citibank joins Barnett, Chemical, Wells Fargo, and 13 others on Prodigy's bank list.
The principal subsidiary of Citicorp has been marketing a PC service for more than a decade, but never before through a commercial on-line service.
Citibank is now pursuing a "virtual banking" strategy employing multiple delivery channels. It is also planning to allow on-line account access to PC users through Intuit Inc.'s top-selling personal finance program, Quicken. And it makes banking services available on computerized telephones with small display screens.
The latest alliance brings together two pioneers that have had their share of struggles in the interactive services market. Citibank rolled out its proprietary Direct Access PC program in 1984. Prodigy began offering electronic banking and bill payments in 1988.
Citibank may have begun to turn the mass-market corner with its elimination of electronic-service fees last June 1. A spokesman said it has since tripled its enrollment for PC and related services, to 125,000 customers, and 20% of the additions were new to the bank.
"Expanding access to our free PC banking service enables us to deliver on our promise to customers - total access to one's money anytime, anywhere, any way you choose," said Frank Liddy, vice president for electronic banking at Citibank. "Prodigy's track record in both the on-line industry and in providing electronic banking services made it Citibank's choice to help us make PC banking more accessible to more customers."
"In the world of banking, Citibank is a thoroughbred," said Prodigy president and chief executive officer Edward Bennett. He called the bank's signing "great news for our subscribers, who now have access to one of the premier and trusted names in American banking."
But Citibank's no-fee policy is shaking up other Prodigy banks that typically charge $5 to $10 a month.
David Frankel, banking services business manager at Prodigy, said institutions in his group "are having discussions about the pricing issues. Everyone realizes it's a barrier to entry."
BankAmerica Corp. and First Chicago NBD Corp. charge fees for home banking through America Online.
