The time to change is when you can afford it.

First, the numbers: 1993 bank profits were $43.4 billion, a third higher than the 1992 record. Return on assets was 1.21%, the first time since the FDIC was created that full-year ROA exceeded one percent. Ninety-five percent of all commercial banks had positive earnings. Two of every three had higher earnings than 1992.

Also, 1993 noninterest income was up by $9.3 billion and contributed 23.4% of total revenue, up more than six points.

This is the kitty with which banks can plan for change.

Depositors' needs are changing. No longer are they willing to come into the local branch for routine transactions. They want greater convenience. It's up to financial institutions to show them how they can make consumers' lives a little easier by providing "one-stop financial services."

Many businesses are looking to serve them. Credit cards, once the dominion of banks, now are provided by AT&T, GM, and others. Brokerage houses are offering checking accounts and cash or debit cards. Telcos and computer on-line services are offering bill-paying and investment services.

These services are not much different from one another. Credit cards and checking accounts serve the same purpose, no matter who issues them. They are a commodity buy for many consumers. Price, convenience, and customer service make the difference.

While all the players will continue to fine-tune their services, the key battle now is over delivery channels. Financial services -- never considered entertainment (and often deemed drudgery) -- will be offered in many ways by those who recognize that no one way will serve everyone.

In the banking industry, the best example of a successful new delivery channel, of course, is the ATM machine. With its introduction, customers no longer needed a person to do the simplest and most important transactions get money, check balances, deposit checks, and transfer funds.

Yet the acceptance of this delivery channel wasn't immediate despite its being convenient and free. Depositors needed to gain confidence in the ATMs ability to get it right. Now, more than 20 years after the first ATM was introduced, consumers use ATMs more than seven billion times a year. Most pay nothing for the service.

Another good example is interactive voice response (IVR) systems to check balances and determine if checks have cleared. As consumers have become used to if not totally enthralled with systems that prompt them through choices, they have come to depend on 24-hour IVR to manage their accounts.

Given how long it has taken for the ATM and IVR to gain acceptance, and how much they cut costs and improve service, why are many providers of financial services now looking to charge high fees for the technologies that will open new delivery channels?

One new channel is the line into the home. The American Banker recently reported, "The consensus in the industry is that [home banking] is back, and this time it's here to stay." Yet nowhere in this lengthy examination of the trend is there any evidence put forth that people are willing to pay for it. It may be that some day depositors will value home financial services to the extent they'll pay a high fee for them. But today, they don't.

After more than four years of testing and market research and two years' selling home financial services, I can tell you that people don't think they are worth paying much for until they try them. This is why the fees some banks are contemplating for such services using computers, TVs, or screen-based telephones are suicidal.

High fees will drive customers to the competitors. Many brokerage firms, telcos, and third-party processors have the deep pockets to deploy the classic marketing strategy: increase awareness, build market share, and prove competency until the consumer recognizes the value. Then begin charging more for the service.

Because consumers don't value the convenience of home financial services until they use them, they typically base their buying decision more on cost. When we suggested different service costs to potential consumers, we found at $12.95, $9.95, or even $6.95 a month, our focus group consumers would mentally tally the cost of stamps and envelopes. But at $3.95 the decision becomes a "no-brainer." Add up the cost of 10 stamps and envelopes and electronic banking and bill paying is an easy sell.

Home financial services also cut costs for financial institutions. An electronic transaction costs a lot less than a paper check to process. But those savings aren't significant until there is a sufficient volume of electronic transactions.

But there are other important reasons to keep barriers to home financial services low. These services are strategic assets when marketed and promoted properly.

Home financial services customers typically have more accounts and are less likely to change banks often. The electronic distribution channel to homes enables banks to cross sell other products, such as loans, investment services, and new accounts.

And with restrictions against interstate banking falling, electronic links to homes outside a bank's native ground costs less to build and maintain than a $1 million branch for every 2,000 customers.

Of course, there is more to selling home financial services than keeping the services affordable. They must give depositors more control of their accounts. The home device must be easy to use. And a bank's plan ought to accommodate new technologies as they emerge.

Competitors both in and outside the banking industry are eyeing depositors. While those outside the industry know they have their own set of challenges, the bank down the street has far fewer and can easily lure your customers. But whoever offers home financial services at a fraction of the cost of the competition will get new customers.

The past few years have been good to banks. The coffers are flush. But it's time to stop counting cash and start making investments in the future. Better now than when funds are short.

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