Making a Complex Business Consumer Friendly
Looking at the New Breed of Bankers
May 25, 2006: Vol. 2, Issue No. 41
IN THE NEWS
Internet banks draw raves
Many like the convenience and higher interest rates, but it's not for everyone.
NEW YORK--Higher interest rates initially drove Nick Sayers to the Bank of Internet. But he soon realized it's more convenient, too. Sayers, 26, a private-equity investor in Chicago, is one of a growing number of Americans ditching their neighborhood brick-and-mortar accounts. Others are moving the bulk of their money to virtual banks like Bank of Internet, which can offer better rates because they don't have to operate multiple branches. To deposit money, customers generally mail checks in postage-paid envelopes, arrange for direct deposits of paychecks, or transfer funds from another account using the Internet or telephone. To withdraw money, they can go to any ATM--some banks, including Bank of Internet, will refund most fees another bank charges.
--Anick Jesdanun, The Associated Press, May 22, 2006
How well does the average consumer understand banking?
In April 1979 I flew to Harrisburg, Pa., to meet with one of the most knowledgeable men in direct marketing, Bob Doscher, then the product development director of Historical Times Publishing.
The previous month, the Three Mile Island nuclear energy plant accident came within a whisker of contaminating much of the Northeast.
The plane was a prop-driven Allegheny (later US Airways) puddle-jumper. I found myself sitting next to a pleasant young lady who was the assistant manager of the bank branch that was nearest to Three Mile Island.
As we flew over the three steam towers that had dominated the media for weeks, the young woman proceeded to tell me a truly fantastic, unbelievable inside story.
"My Money Is Radioactive!"
Immediately following the Three Mile Island accident that nearly fried millions of Northeasterners, this local bank branch had huge run on cash. Depositors were lined up around the block desperate to get their money out.