You could almost hear the sigh in his voice. "We are a technology solutions provider," he said, sounding as though he'd made the statement a thousand times before.
The man speaking was Raymond Stern, Intuit Inc.'s senior vice president for corporate development and strategy, and he was answering questions about lingering concerns over Intuit's sometimes-awkward tango with financial institutions. The unspoken addendum to his statement was that Intuit is not a bank, and is not planning to become one.
The Mountain View, Calif.-based company has sometimes had a difficult time convincing banks of that. About five years ago, Intuit made some forays into traditional banking services, such as payment processing, that made some bankers feel threatened. It was shortly after Bill Gates had made his famous "dinosaur" remark, and both Microsoft Corp. and, to a lesser extent, Intuit, were looking like predators.
Today, Microsoft may have its own antitrust problems, but they are less likely to worry financial services executives. Similarly, while mistrust lingers between bankers and Intuit, the latter has made strides in persuading banks that it wants to complement, not compete with, their services.
Banks could never regard Intuit simply as a competitor. Ever since the Internet began to drive consumers online for financial services, Intuit has had a nuanced and symbiotic relationship with banks. Intuit wants partnerships with institutions so consumers can download account information directly into Quicken, Quickbooks, or TurboTax applications. And banks, trying to cement loyalty and increase traffic to their own sites, want to please - and have access to - Intuit's base of loyal users, many of whom became devoted to Quicken long before the Internet made its mark.
"We're reaching out," Mr. Stern said. "We actively search out banks to partner with. That's very different from us offering a direct deposit account to the customer." He emphasized over and over again that Intuit is "a very viable and value-added partner" for financial institutions, and can help them strengthen their relationships with their customers. Currently, more than 1,500 financial institutions connect with Quicken.com, offering downloads of customer data.
That number may partly reflect a lack of balance in the equation. Banks don't want to alienate customers who demand data downloads for Intuit products, and Intuit's 22 million financially-savvy customers are a tantalizing pool for banks to reach.
That Intuit acts as an intermediary between institutions and consumers still rankles at some banks.
"Banks would rather not have any intermediary, and do it all on their own," said James Van Dyke, a senior analyst at Jupiter Media Metrix. "The question is, can they?"
The main issue for institutions is whether partnering with Intuit "adds more value or detracts value," he said. For banks slow to enter the Web arena, serving Net adept customers through Intuit may be the best option, he said.
Meanwhile, he said, Intuit is trying to figure out how it can get the most revenue from banks without jeopardizing relationships. From Mr. Van Dyke's perspective, Intuit "is doing the best they can not to seem like a bank" - for example, by moving out of the electronic bill payment space.
Mr. Stern acknowledged that Intuit's venture into electronic bill payment, specifically with its 1994 purchase of National Payment Clearinghouse Inc. "scared some people." But the company sold the division to Checkfree Corp. in 1996. This May, Intuit sold the last shred of its electronic billing business of this year to Princeton eCom.
He also downplayed Intuit's inroad into the mortgage business through its QuickenLoans product. That fast-growing service was born of a realization that "we needed to control the [origination] process from end to end," rather than handing off mortgage customers to other providers, he said. He stressed, though, that "we're not in the servicing business, and that's the attractive part to many financial institutions."
Mr. Van Dyke noted that he has heard less concern from banks lately than he did a few years ago. "With the growth of the Web, the fear has started to go away," he said. He suggested that, as banks' online services become more sophisticated, Intuit's dominance in personal financial management products may actually be challenged.
Mr. Stern said Intuit devotes "a lot of staff" to relationships with banks, and works hard to help banks "understand why using our tools and technology can help them."
Note: The "Managing Privacy" column, which usually runs on Tuesdays, will appear tomorrow.
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