First Chicago NBD Corp., an early advocate of using Windows-based software for cash management, is making this service available through Internet browser software.
The transition is one that many prominent wholesale banking companies, including Chase Manhattan Corp., Citicorp, and NationsBank Corp., already have begun.
With browsers such as Microsoft Corp.'s Internet Explorer or Netscape Communications Corp.'s Navigator, corporate treasurers gain access to cash management services via the Internet or intranets. The browser is the only desktop software required, and most potential users already have it installed.
Windows-based cash management services require banks to distribute and support software. Upgrades are cumbersome, requiring treasury management banks to mail out diskettes or send technicians to customer sites.
First Chicago NBD is jointly developing its system with American Management Systems Inc., a Fairfax, Va., software developer. They plan to develop a balance reporting service first, which would let corporations create customized views of their cash positions and manipulate and analyze this information.
A variation of the technology, which is owned by American Management Systems, was used to develop a browser-based letter of credit system for Royal Bank of Canada.
Browser-based cash management "is much simpler and much less expensive" than Windows-based, said Susan French, vice president at American Management Systems. "Banks are banks, not software vendors. Most do not have the organizational structure or development tools for building end- user software."
In 1993, First Chicago developed and heavily promoted FirstWindow 2000, an early cash management service based on Windows technology. First Chicago executives were unavailable to comment on their plans for the companies where FirstWindow 2000 has been installed.
The Chicago banking company's push into Windows-based software, then superseding aging DOS-based cash management systems, spawned a proliferation of similar services among competing banks. Browser software is now prompting a renewed wave of cash management competition and development.
"There is real logic to this," said Lawrence Forman, a cash management expert at Ernst & Young, New York. "It is very expensive to develop and keep things going in Windows. At some point, not having browser technology will be a competitive disadvantage."
George Kivel, an analyst at Cambridge, Mass.-based Mainspring, an electronic commerce consulting company, said he anticipates that more large banking companies will climb on the browser bandwagon.
He did caution that browsers can be a commoditizing force, leading companies to build systems that integrate information across numerous banks.
"The battle will be over who controls the coordination and the information," he said. "Does that right belong to the company, or does it belong to the bank?"
Banks could be providers of commodity products instead of becoming more profitable value-added information managers. Browser-based technology "certainly lays a foundation that could end up further disintermediating banks," Mr. Kivel said.
