Citigroup Inc. unleashed a pair of Internet initiatives Tuesday, announcing it is teaming up with America Online to build a set of payment products and with to start an account aggregation service.

Citi's effort puts it within a circle of banking companies that are trying to get a leg up in Internet payment and account aggregation.

And it has landed high-profile partners. America Online has more than 23 million paying subscribers worldwide and gets about 50 million visitors a month. Sunnyvale, Calif.-based has recently signed contracts with a number of large institutions, including Chase Manhattan, Merrill Lynch, and FleetBoston.

Citigroup will co-develop and co-brand new payment and money transfer products that will be available on such AOL properties as, CompuServe, Netscape Netcenter, AOLTV, and Digital City.

Beginning in the fall, AOL's customers will be able to register for Internet transaction accounts to be funded from their bank or credit card accounts. Person-to-person money transfers, person-to-merchant payments, and auction transactions also will be offered. Users eventually will be able to transfer money between accounts at any financial institution.

Right now AOL only permits credit card transactions, said Robert Willumstad, head of global consumer lending at Citi and manager of the banking company's e-Consumer division. The companies plan to add lines of credit created specifically for the Internet and to introduce features such as airline miles, purchase protections, and guarantees.

"This is an important first step in becoming a consumer payment standard on the Internet," said Deryck Maughan, vice chairman of Citigroup and chairman of Citi's Internet operating group.

Citigroup will become a preferred provider in the personal finance areas of AOL, Netscape, CompuServe, and Digital Cities, and the continuously displayed financial institution on the new MyAccounts aggregation area of AOL's personal finance channel.

Citigroup will pay AOL for every new customer it signs through the portals.

Other notable pairings of big banks with prominent Web companies in Internet payment include Wells Fargo's deal with Ebay, an online auctioneer, and Bank of America's alliance with CheckFree Corp. to develop a set of payment services, including person-to-person transactions.

In the Yodlee deal, Citigroup will let customers and noncustomers view accounts they hold with any institution at site, which went live Tuesday. In addition, customers will be able to aggregate their e-mail and frequent flier miles at the site.

"We're creating a single account statement for credit cards, brokerage, and mutual funds," Mr. Maughan said. "The customer decides which accounts he wants to load up."

The site also offers one-stop shopping for Citigroup products, including Citibank banking, loans, mortgages, and credit cards; Salomon Smith Barney brokerage and investment products; and Travelers insurance products. Another feature, financial calculators, enable customers to work out repayments on car loans, for example.

Christopher Musto, director of financial services at Gomez Advisors Inc., noted that, while Citigroup is not the first big bank to announce it will offer account aggregation, it is the first to implement it.

"Chase already announced a relationship with Yodlee," he said. "But you can use Yodlee through Citi first."

He predicted that Yodlee and the methods it employs, such as screen scraping, will gain consumer acceptance through the Citigroup relationship. "When presented with a new financial service, consumers look to their banks to offer such a service because of the implied trust and convenience," Mr. Musto said.

Jaime Punishill, senior analyst at Forrester Research, said the AOL deal is "great for Citibank but not so great for AOL." Because Citi is the exclusive provider of financial products on AOL, he said, "Customers are limited to what they can access, and that's a mistake."

He found the payment piece of the deal to be "really interesting" because Citigroup's technology will be tightly integrated with AOL's electronic wallet. "The danger here is a knee-jerk reaction from Chase and [Bank of America] to develop their own," he said. "This will happen unless Citi makes its technology available as a standards-based payment infrastructure."

Ron Mandle, an analyst at Sanford C. Bernstein & Co., said: "The idea of funds transfer is becoming competitive. With AOL, Citi has a good chance of being successful."

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