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Study shows institutions underestimate the Web – silly bankers

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European banks have not grasped the threat of the Internet and risk losing customers unless they shape up, according to a study out today. Today’s report by Price Waterhouse Coopers (PwC) and the Economist Intelligence Unit was based on interviews with over 50 top banking execs. It claims that banks see the Web as "futuristic" and do not understand the dangers of losing out to new rivals. Angus Hislop, senior banking partner at PwC, said US banks had become aware of the threat of cyberbanking after seeing new ventures swipe customers. But their European counterparts were being left behind, blissfully unaware that Web auctions were showing customers the best accounts and savings plans. "They have been slow to realise the speed at which the Internet changes banking for ordinary people. Banks will be able to tailor products for individuals, effectively bringing private banking to everyone," he said. The study did not find one large retail bank that fully understood the scale of change needed, although Barclays has recently launched a campaign to promote its own PC banking services by offering a free ISP package to its customers. "Unless the banks wake up very quickly they are going to lose out," Hislop warned. Brand value, which banks have traditionally spent millions on, paled in significance to fast, convenient and glitch-free banking services. "All the great work done by banks to build brand value will not be able to offset what search engine technology is about to deliver," warned one banker questioned for the survey. ®

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