Banks are beginning to use the Internet to cater to the traditionally underserved small-business market.

Citigroup, PNC Bank Corp., KeyCorp, and Silicon Valley Bank are the latest to offer Internet services that help small businesses get up and running on the Internet. Each is taking a unique approach to servicing corporate customers with less than $50 million of assets.

In a May report, Meridien Research, the Newton, Mass.-based research firm, said financial services companies have largely overlooked the business opportunities in the rapidly growing small-business customer segment, because the support requirements -- relationship managers and branches -- have traditionally been too expensive. But the Internet changes all that.

E-Citi, the Citibank division responsible for the bank's overall Internet strategy, has launched a separate Web site, bizzed.com, to provide a range of financial services to small businesses. These include payroll and electronic banking, credit card processing, insurance and retirement plans, marketing and advertising support, and procurement of business supplies, all offered at big discounts.

Karen Sokota, general manager of bizzed.com, said the site would initially offer Citigroup products and services, but expand to offer financial services and content from other banks and businesses. It is targeting its own several million small-business customers and will use bizzed.com to attract new clients in both the "clicks and mortar worlds," she said.

The Internet allows Citigroup to deliver its broad set of financial services to small businesses in an integrated fashion -- including those from Citibank, Travelers Group, and Salomon Smith Barney, said Ms. Sokota.

Citigroup will first target small businesses in the United States, Ms. Sokota said, with an international rollout scheduled for next year.

Citigroup's decision not to use its internationally known brand is a unique approach to on-line merchant services. The "bizzed" name is meant to convey Citigroup as a "backup partner" to small businesses, said Ms. Sokota, a support role through which Citigroup can develop trusted, lasting relationships. "Bizzed" also connotes something "irreverent, jazzed and hip, forward-looking, fun, easy, and personable," she said.

Pittsburgh-based PNC Bank Corp. is also set to launch this month a service to help small businesses get on-line, drive traffic to their stores on the Internet, and process payments. The service, called iSites, was developed with Intel's iCat division that provides electronic commerce services, like Web hosting, to small and midsized businesses.

James G. Graham, executive vice president and manager of business banking at PNC, said iSites will be targeted to the 200,000 corporate clients in the bank's geographic area -- New Jersey, Ohio, Delaware, Kentucky, Pennsylvania, and Indiana -- that have less than $50 million in assets. Mr. Graham said the bank hopes to sign at least 15% of its small-business customers to the service over the next two to three years.

Mr. Graham said PNC would also be able to enlist new small-business customers through iSites and sell those clients other on-line products, such as loans, cards, and mortgages.

PNC's three million retail customers will be made aware of shopping opportunities at the small-business members of iSites.

KeyCorp, based in Cleveland, has also partnered with a technology vendor to launch the new portal that targets its 400,000 small-business customers. The site, keymerchants.com, includes the recently announced EconexStore, a technology platform that helps small businesses create Web storefronts and securely transact on-line. Key made an equity investment in Econex of Independence, Ohio, a technology developer.

Silicon Valley Bank, a $4.1 million-asset bank in Santa Clara, Calif., is specifically targeting technology and life- science entrepreneurs with its on-line resource portal, eSource. Through alliances with a variety of service providers, Silicon Valley Bank offers these businesses financial and administrative services, human resource forecasting, risk management services, and industry-specific research.

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