National Westminster has become the latest bank to drop interactive television from its electronic services lineup, raising more doubts about the medium's ability to compete with personal computer networks.

Natwest has decided to deliver an on-line mortgage service via PCs rather than over the souped-up, set-top boxes it used initially.

The New Jersey-based bank, which is being acquired by Fleet Financial Group, has been offering video access since April to mortgage sales representatives through a one-way cable link, according to Andrew DeMeo, director of interactive marketing for Natwest. Four real estate agencies and a dozen bank branches are hooked up.

Although the program is faring well, Mr. DeMeo said, the explosive growth of on-line PC networks and devices has influenced the bank's thinking. Seeing powerhouses like Microsoft Corp. adopt an aggressive Internet strategy contributed to this new view, he added.

"Right now, if people are going to use on-line services, it's the PC and the Internet," he said. Three years ago, when the idea for the mortgage service was conceived, "there wasn't this critical mass of people anywhere."

The bank has not dropped interactive television entirely, Mr. DeMeo said, and Natwest will continue to work with its cable network partner, Comcast Communications.

Natwest is not the first bank to postpone or terminate an interactive television project.

Shawmut National Corp., now fully merged into Fleet, last September decided to pull the plug on a much-ballyhooed interactive television project with AT&T Corp. Meridian Bancorp also quietly pulled back from its development.

Shawmut executives cited a lack of customer interest. They said "concept testing" had shown consumers would be unwilling to cough up $350 for the set-top device. Other sources claimed the network technology was simply not up to snuff.

Still asserting that interactive television is "doing just fine" are proponents like Andrew Sernovitz, president of the Interactive Television Association in Washington.

Interactive TV is still in its early stages, as much as a decade behind personal computers, he said, and recent regulatory decisions are only now freeing telecommunications and cable companies to broaden their services.

Television-based banking is "waiting in the wings," according to Dale Reistad, a veteran payment systems consultant formerly involved in Eon Corp., a noted ITV venture.

And continuing developments like a Time Warner Inc. project in Florida involving Barnett Banks Inc. offer some promise that the medium will not be completely supplanted by the PC.

"Things are looking rosier than they have in years," Mr. Reistad said.

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