On-line banking offers great promise but "is still in its infancy," according to a study released Wednesday by the Commerce Department.

The report, which attempts to quantify the Internet's impact on the economy, said that though many banks have Web sites, most do not permit customer transactions.

Only 24 of the top 100 financial institutions are "true Internet banks" permitting funds transfers and on-line bill payment, the report said. Similarly, the services banks typically offer only scratch the surface of what is possible.

"Online banking today merely duplicates what can be done through other channels," the report concluded.

Banks have a lot to gain from offering on-line banking. A 1996 Booz- Allen & Hamilton study said an Internet banking transaction costs 1 cent, versus 25 cents by ATM, 50 cents by phone, and $1 via teller.

Banks also can use Web sites to gather information about a customer's financial goals and then market products and services accordingly, such as credit cards, home equity loans, and life insurance.

On-line banking is expected to grow significantly in coming years, from 4.5 million households in 1997 to between 10 million and 16 million in 2000, the report said.

Still, nearly half of all computer-owning households did not know if their banks offer on-line services.

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