From the web to your wallet

Access to bank balances online is boosting online numbers

By BBC News Online technology correspondent Mark Ward

Britain is turning into a nation of electronic bankers.

By 2005, almost half of us will be managing our financial affairs via the net predicts a survey for the First Direct bank.

Over the same time span, the UK's internet population is set to double to almost 38 million people, it finds.

As well as changing the way that people live their lives, the survey predicts that it will spell big changes for companies because online consumers are likely to be more demanding and willing to expose those companies that give poor service.

Banking begins at home

Phone bank First Direct has set up a survey programme that it believes to be the biggest continuous online survey of consumers ever carried out in the UK.

Going by the name of the E-Service Monitor, the survey will be carried out every quarter and will try to map changing attitudes to the net by asking 500 or more current net users how their use of the net is changing. The survey is being carried out by think tank The Future Foundation.

"We are trying to develop a realistic consumer-based view of what the internet is all about," said Matthew Higgins of First Direct.

Mr Higgins said the results from the first two surveys, carried out in November 2000 and February 2001 respectively, had just been released and revealed that consumers had remained largely unaffected by the hype and subsequent disillusionment that has attended the dot.com revolution. Britain's net population is growing steadily and now stands at 19 million people who, between them, go online 130 million times per week.

The survey predicts that this population will double over the next four years, but will gradually change in character as the number of ways to access information held online proliferate. "At the moment, the internet is synonymous with the PC," said Mr Higgins, "but that is going to change, as is what people are doing with it."

By 2005, 75% of the population will have access to the net in one form or another - either via PC, interactive TV, mobile phone or handheld computer.

Setting standards on service

Signs that familiarity changes the way that people use the net or online information are already apparent. "There is less surfing going on," said Mr Higgins. "Those who go online on a regular basis are probably going to the same selection of sites."

Banks will be one of the big winners as consumers start to interact more regularly with companies via electronic means. Mr Higgins said that already about a third of First Direct customers did part of their banking online. Barclays Bank reports a similar figure. By 2005, the survey predicts that almost 50% of the UK population will be dealing with their bank online, at least part of the time.

That shift could have important consequences for many companies, reveals the survey. It found that at the moment consumers are quite forgiving, and have relatively low expectations of the level of service they should get from the website of a company they are used to dealing with in the high street.

But as consumers become more familiar with life online their expectations will rise and they will expect websites to be as good as high-street service. The ease with which consumers can communicate online will shine a spotlight on those companies that do not do a good job of meeting customers needs.

"Those organisations that do not provide good service, however consumers define that, will become exposed quite quickly," said Mr Higgins. "Eventually people will simply stick with the organisations they trust."