Chase Manhattan Corp. has installed a pair of automated banking kiosks that allow customers to meet "face to face" with bank representatives via a video screen.

The kiosks, from Personal Financial Assistant Inc., Charlotte, N.C., are souped-up versions of machines already installed at several institutions, including PNC Bank Corp.

The kiosks allow customers to open accounts, apply for loans, and do a number of other noncash transactions that require some intercession by a bank employee.

What differentiates the Chase machines from most other Personal Financial installations is that Chase is using full-motion, two-way video in the terminals.

Beyond Still-Life

This means that customers and bank representatives are able to see one another's full movements and gestures as opposed to just the still-life images that appear on the screens of most kiosks in current use.

"We made the decision to go with full-motion video because we feel it's easier to sell," said Robert Lytle, a Chase vice president. "With the still pictures, [customers] are more likely to say, |What's the big deal?'"

As Mr. Lytle indicated, Chase and other banks are hopeful that the novelty of communicating with a bank representative over a video screen will lure customers into sales discussions.

But even after the novelty of the technology inevitably fades, video banking has some other benefits, bankers say.

Reduced Costs Expected

By allowing loan experts and other personnel to be placed in centralized customer service locations that can be staffed more efficiently than individual branches, video banking is likely to reduce operating costs, bankers feel.

According to Personal Financial Assistant research, a meeting between a customer and bank representative via video screen is as effective a selling opportunity as an actual face-to-face meeting. Both result in sales about 70% of the time, according to Personal Financial, which is owned by the New York Life Insurance Co.

Tests of full-motion video have been on too small a scale for bankers to affirm or refute those claims.

However, Synergistics Research Corp., an Atlanta-based concern that measures consumer opinion on banking technologies, has found that bank customers are becoming increasingly receptive to video banking.

"The environment's better than it's ever been for the introduction of video banking services," said Genie Driskill, a vice president in research at Synergistics.

Ms. Driskill said the company's research also indicates that consumers are more likely to use terminals with two-way, full-motion video than terminals with still pictures only.

Although Chase is in the forefront of implementing full-motion video terminals, the bank is not the only big bank to try out the technology. NationsBank Corp., based in Charlotte, N.C., has also tested Personal Financial kiosks at two sites.

Neither Chase nor Nations Bank has yet made a large-scale commitment to the technology, bank officials said.

How It Works

A transaction at one of these terminals would proceed as follows: A customer picks up a phone handset that rests beside the video screen in the banking kiosk. The phone is linked to a customer service representative who can establish a video link with the customer.

Once the video is engaged, the customer service representative leads the customer through the desired transaction by displaying each step in the transaction on the screen.

If the customer wants to apply for a loan, for example, the customer service representative displays the application so the customer can see how the bank employee is transcribing the information that is being verbally relayed.

Some transactions may require the customer to provide identification, so the kiosk is equipped with a scanner that can transmit copies of a driver's license to the customer service representative. This scanner, which resembles a standard copy machine, can also handle larger documents.

At the end of the transaction, a customer receives a printout of all the documents that are filed on his or her behalf.

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