Banks are not the only ones struggling with pricing strategies for on- line banking.

All three major providers of personal financial management software- Intuit Inc., Meca Software Inc., and Microsoft Corp.-have been tinkering with how they make money from their products' roles in home banking programs.

Microsoft was the most recent to change its approach. The company has announced the elimination of certain fees to banks that use Microsoft Money in their on-line programs. These banks currently pay 75 cents to $1.25 per month for each customer using Microsoft's Money.

Some observers said the move could change software pricing in much the same way that Citicorp's elimination of on-line banking fees altered bank pricing. In the wake of the Citi announcement, several high-profile banks, including Chase Manhattan Corp., removed their on-line banking charges.

"In dropping its connection fees for on-line banking, Microsoft has ... set a precedent for other financial software houses," said Karen Epper, an analyst at Forrester Research in Cambridge, Mass.

"It is going to be a long, hot summer" for the software vendors, said Scott Smith, an analyst with Jupiter Communications in New York. "Just as the consumer fees will drop toward zero, I wouldn't be surprised to hear more price cuts and charge-dropping across the board," he said.

Many see Microsoft's gambit as a not-so-subtle attempt to draw banks closer so it can sell them products in the Windows NT computing environment, such as the Marble server software that Microsoft is expected to begin selling in the fall.

"This is an attempt to put NT servers in banks," said Mr. Smith.

But Microsoft officials insist the company's main goal is to boost sales of Money, which is No. 2 in sales of personal finance software, behind Quicken.

"More and more financial institutions don't want to be in the software distribution business," said Matt Cone, product manager of Microsoft Money. "They are advertising the software and having people go out and buy" it at a retail price of $29.95, he added.

Banks that buy the software to give or resell to their customers pay $7.50 a copy, or Microsoft's cost, Mr. Cone said. ($3.50 for the software, disks, and manuals; $4 for customer support.)

"When institutions buy the software, we aren't making money, but we are hopeful that the next year the customer will go out and buy the upgrade," he said.

All told, annual costs for a bank with 10,000 customers connecting through Money could be as little as nothing and as much as $75,000, depending on how many copies the bank bought for its customers.

Archrival Intuit relies on more than just sales of Quicken, which retails at $34.95. It also gathers revenue from monthly connection charges of between 75 cents and $2 per customer from banks offering bank-branded versions of its software.

Intuit reportedly charges banks $3 per copy for a stripped-down version of Quicken-and significantly more for the full-featured version. (Intuit officials declined to furnish details of their pricing.)

A bank with 10,000 on-line customers would pay Intuit as little as nothing and as much as $270,000 annually, depending on the number of software licenses it bought and whether it chose the bank-branded route.

Although Meca Software, which is third in sales, holds less than 10% of the market for personal financial managers, the Trumbull, Conn.-based company has been adding more than 40,000 on-line customers each month.

"That is much beyond what our competition has done," said Meca's president and chief executive officer, Paul Harrison.

Moving toward an entirely bank-centered approach, the company is phasing out off-the-shelf sales of Managing Your Money software, which currently retails for $19.95.

Instead, Meca sells the software to financial institutions for between $4 and $8 a copy, according to the number of copies it purchased. Banks pay between 60 cents and $1 per month for each customer connecting through the product, Mr. Harrison said.

"America Online has shown the successful way to sell on-line service is to give consumers the software," said Mr. Harrison. "Our software allows banks to be very aggressive" in distributing software.

A bank with 10,000 customers connecting through Managing Your Money would pay Meca between $112,000 and $200,000 annually.

A fourth player in personal financial management software, Home Financial Network of Westport, Conn., also uses a bank-centered approach. It offers its Home ATM software at a cost of $12 per license.

Given the $1 monthly connection fee per customer, a bank with 10,000 on- line users would pay Home Financial Network $240,000 a year, said vice president of marketing Thomas S. Dittrich.

As hot a topic as it is now, debates over the pricing of personal financial management software may cool off over time, as Internet-based banking becomes more widely accepted.

"Of the big three, Intuit has the most difficult road ahead because they have this built-in base of 10 million users that they have to keep happy at the same time that they are trying to reinvent themselves as an Internet company," said Ms. Epper.

And despite the ground that Microsoft is likely to gain with bankers, there are many who are not letting their guard down regarding the Redmond, Wash.-based software giant's intentions, she added.

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