The demise of Citi f/i is a new sign that Internet-only banking is losing momentum - and that Sanford Weill is putting his stamp on Citigroup Inc.'s Web efforts.

Citi confirmed late Friday that it was changing direction on Internet banking. And on Monday a spokesman said it would replace Citi f/i, its Internet-only bank, and Direct Access, its longstanding online banking program, with a new service.

The new service will have a different brand name and combine the best features of Citi f/i, which was introduced last August, and Direct Access, said the spokesman, Mark Rodgers. It will probably not have the Citi f/i ban on using branches.

"The new service is going to be dynamic and better than the other two services, which are good to begin with," Mr. Rodgers said. "Consumers want some clicks-and-mortar to do their banking. This way we can offer a full range of products, from the Internet to branches."

Mr. Weill announced the impending change in comments he made to analysts in April, Mr. Rodgers said. The company's Internet efforts had been the central purview of co-CEO John Reed, who retired that month.

The new service "does not have a name yet," Mr. Rodgers said. "We don't have an announcement yet."

Citi f/i is still running as www.citifi.com on the Internet.

Citigroup is not the first financial company to recognize that offering services exclusively through low-cost electronic channels may be an elusive dream as long as customers chafe at not being able to visit branches.

Bank of Montreal, for example, pulled the plug on its Internet-only bank, mbanx, last August, saying most of its customers wanted to bank through a combination of physical and electronic channels.

Royal Bank of Canada bought Prism Financial Corp., a Chicago mortgage company, in March so that its own U.S. Internet-only subsidiary, Security First Network Bank, could serve customers through Prism's 150 branches.

And Bank One Corp. is continuing to search for ways to make its Internet-only venture, WingspanBank.com, more profitable. In a recent interview, John B. McCoy, the bank's former chief executive, said that he had envisioned Wingspan having a network of its own branches to accommodate customers.

At Citigroup, Mr. Weill announced in March the creation of an Internet Operating Group to put control of the Internet back into the hands of business units, rather than in a separate unit. Mr. Reed had championed Citi's original strategy - the creation of a standalone unit called e-citi - for setting Internet policy and direction. E-citi still exists, but as a complement to two new divisions, e-Consumer and e-Business.

Citi f/i is not the first semi-experimental site Citigroup has floated on the Internet. For about a year it has been testing a service called Finance.com, which would give subscribers financial advice, let them shop for loans, and view all of their financial accounts, even those not held at Citi. It is scheduled to be available by yearend.

Citigroup is backing out of Citi f/i just as stealthily as it got into it. The bank opened the Citi f/i site last August with no public announcement or advertising. It began marketing the service in January, but only in Austin, Tex. It ran print and radio advertisements there and relied heavily on incentives, including a "Millennium Technology Makeover Contest," to encourage customer referrals.

The contest invited people to nominate a friend or a co-worker whose home work space needed new technology. Citi f/i planned to boost response rates by awarding technology and cash prizes to the winners and their nominators of up to $1,000 in a Citi f/i account.

"We have concluded test marketing in Austin," Mr. Rodgers said. He said the company did not release figures on the number of customers it attracted in the campaign.

Gomez Advisors of Concord, Mass., estimated that Citi f/i had 30,000 customers at the end of 1999. The Internet research and consulting firm ranked Citi f/i ninth on its scorecard of top Internet banking sites. It ranked Citibank Direct Access, which has about one million customers in 14 countries, in seventh place.

"Both are fairly competitive offerings," said Christopher Musto, director of financial services at Gomez Advisors.

Direct Access supports a broad range of products, including checking, lines of credit, personal loans, credit cards, money market and investment products, and a bill payment service that is "very intuitive and easy to use," Mr. Musto said.

Citi f/i has positive attributes, such as 24-hour customer service and automated teller machine fee rebates. "But the process of opening an account can be befuddling," Mr. Musto said. "The fulfillment process still has some issues with it."

David Berry, director of research at Keefe, Bruyette & Woods Inc., said that he has been struck by the large number of customers that traditional banks have signed up for online banking, compared with the Internet-only banks.

"Leveraging off an existing brand and franchise has a lot of merit to it," Mr. Berry said. The nature of the Internet, he added, is "to try things. There's no shame attached to something if it doesn't work."

Robert Sterling, a financial services specialist at Jupiter Communications, said: "It's a tough time" for Internet-only banks. "People need a compelling reason to use an online bank, and price sensitivity isn't always enough."

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