In its first six weeks, Barnett Banks Inc. signed more than 300 customers to use its electronic cash management service for small businesses.
Known as the Barnett Connection, the aggressively marketed program links the business owner's personal computer to the bank's central computer. The subscriber can view updated account information and perform banking transactions at the keyboard.
The technology behind the service comes from Harbinger Computer Services, an Atlanta-based software firm. Barnett licensed Harbinger's In Touch Cash Manager product, which is installed at more than 100 banks across the country, and attached its Barnett Connection label.
Barnett Banks Inc., based in Jacksonville, Fla., was the 19th-largest bank holding company as of March 31, with $32.9 billion in assets and 593 offices in Florida and Georgia. Its rank will rise with the acquisition of $5.4 billion-asset First Florida Banks Inc.
A Strategic Shift
Charles Wickenden, information services product manager, said the Barnett Connection represents a strategic shift in the way the company serves smaller corporate customers.
"Small-business owners have often been ignored by banks," he said. "We've decided to reach out to companies that have less than $5 million in annual sales. ... There is a lot of opportunity in this segment of the marketplace."
Increasing numbers of banks are coming to the same conclusion.
"The reason you are seeing bankers of all sizes commit to this market is the profitability of the relationship," said Kathleen C. Holmes, executive vice president of Furash & Co., a Washington-based consulting firm.
"The return on assets with smaller corporate customers can be anywhere from 5% to 8%."
Features and Costs
The Barnett Connection enables the customer to make account inquiries, transfer funds, reconcile account registers, and write checks from their personal computers. The software costs approximately $100. Basic monthly usage charges start at $25 and go up depending on how many accounts are on the system.
Although the Barnett customers make their connections through a modem, the customer doesn't have to engage in the sequence of steps that most modem calls require. Instead, once the program is turned on, the modem connection is made automatically.
Neil Chambliss, research director of Payment Systems Inc. in Tampa, Fla., said the Barnett Connection is especially appealing because it is available all day, not just during traditional banking hours.
PSI, a research firm affiliated with the American Banker, provides market research and consulting services in electronic banking and other fields.
"We've talked to many small merchants, and one of their major concerns is hours of operation," Mr. Chambliss said.