People who surf the Internet are eager for on-line financial services but frustrated by the clunkiness of most bank Web sites, according to a survey to be released Monday.
Of 520 on-line users polled by NetSmart, an Internet research company in New York, 83% said they were interested in banking electronically for routine transactions, and 64% said they wanted to pay bills on-line.
In addition, 56% of respondents said they were willing to do major transactions on-line, like buying and selling stocks, mutual funds, and certificates of deposit.
The sticking point, according to survey author Bernadette Tracy, is that most bank Web sites are "average to poor."
"Banks have really not grasped what the Internet is," said Ms. Tracy, a psychologist who founded NetSmart two years ago. "One of the biggest mistakes they make is referring people on their Web sites to '800' numbers, which is one of the biggest no-nos in the business."
NetSmart's findings are consistent with those of other recent studies of Internet users and their propensity to manage finances on-line.
A larger survey of 3,255 U.S. households conducted this fall by Jupiter Communications and Find/SVP found that three-quarters of respondents expressed willingness to pay as much as $10 a month for the convenience of on-line banking.
"We strongly believe there's a robust market for electronic financial services developing," said Adam Schoenfeld, a Jupiter analyst.
However, he said, bank offerings have been "poorly conceived to date."
Virtually every top polling organization and many consulting firms have conducted Internet surveys of late. Ms. Tracy distinguishes her survey by its psychological orientation.
"I word my questions a lot differently," said Ms. Tracy, who holds a master's degree in marketing and psychology from the University of Chicago. "I said, 'All right, let us assume that the security issues are resolved. How willing would you be to use on-line banking?'"
Ms. Tracy, who says she aims to become a sort of Dr. Joyce Brothers of Internet research, cut her teeth a decade ago by gauging customer receptivity to automated teller machines for Citicorp.
More recently, she has gone into the business of surveying computer use: Last year she tried to trace a demographic profile of Internet surfers, and this year she tries to show how companies can profit from the World Wide Web. The new report will be sold for $5,500.
"The more time you spend on-line, the more comfortable you become, the more you trust the Internet," Ms. Tracy concluded.
In what she termed her most "mindblowing" finding, 56% of respondents had made an on-line purchase, and 73% had paid by credit card. Yet 48% of the credit card purchasers also said they were "very concerned" about the safety of placing card numbers on-line.
The psychological term for this, Ms. Tracy said, is "cognitive dissonance."
"When you're faced with two compelling alternatives, the stronger will prevail," she said. "If the benefits are stronger than the concerns, then the concerns will evaporate. What you have on the Internet is hypothetical concerns rather than experiential."
The same phenomenon once dogged ATM cards and appears to be hampering the acceptance of smart cards, she said.
"In the early days of ATM cards, everybody hated them," Ms. Tracy recalled. "Everybody said, 'The banks will steal my money, they'll put it in somebody else's account, I'll get mugged on the street, my card will get stolen."'
Ms. Tracy divided Internet users into four categories: "newbies," who had been on-line less than a year; "novices" of one to two years; "mainstreamers" of two to five years; and "veterans" of over five years.
"What I found is there is an evolutionary pattern in consumer behavior on-line," she said. "When you first go on-line, you're like a kid in a candy store. You're going to the University of Moscow Web site, and to Tahiti and the Egyptian pyramids.
"Then, as the novelty wears off, you start to realize little by little the real practical benefits that the Internet offers. You say, 'Oh my goodness, I can research bank rates. I don't have to use the Wednesday paper to go to different banks. I can research a car. I can go to Auto-by- Tel and find out dealers' margins.'"
With that realization, according to Ms. Tracy, "your entire usage pattern shifts from entertainment to information."
NetSmart is a 12-person firm that sells research to large companies. Among the banks that purchased last year's Internet report were Citicorp, Chase Manhattan Corp., NationsBank Corp., PNC Bank Corp., and Dime Savings Bank, Ms. Tracy said.
None of the companies that have agreed to buy the latest report have seen it yet. Mark Minsky of Chase Manhattan said he was expecting the report in November but that it had been delayed.
