One day in the near future the world’s largest Internet bank intends to partner with an online broker — becoming a total financial-services-portal.
So said Deborah Newman, director of marketing for Arlington, Virginia-based Telebank, in an interview with the E-Commerce Times last week. But that’s not all. “We plan to have a virtual insurance agency in place by June,” Newman added. “We’re also going to be offering an Internet credit card.”
Last month, Telebank formed a strategic partnership with Insurance Answer Center, which will soon begin offering a montage of insurance products to the bank’s customers. In March, Telebank cut a deal with First USA to offer its accountholders an Internet-enabled credit card with no annual fee and a 5-month teaser rate of 3.9 percent.
Now, Newman said it’s only a matter of time before the missing online brokerage piece is put in place — though she declined to identify which online brokers Telebank is currently courting.
Albert Pang, an analyst with Framington, Massachusetts-based International Data Corp. said such a marriage makes sense. “Think about it. They have to offer you something that keeps you coming back, because they’re not made of brick-and-mortar,” Pang said.
Clustering into super-sites and broadening markets is an essential tactic for those e-commerce businesses hoping to survive over the long haul, he added.
Telebank Has More Than Survived
Even though lately its stock has fluctuated with the market, it’s impossible to ignore it meteoric rise from about $8 (US$) a share nine months ago to $90 last week. In addition, last quarter, Telebank reported that it had more than 60,000 customers and $2.6 billion in assets. But it’s not alone. Other Internet banks are also experiencing phenomenal growth.
Alpharetta, Georgia-based Net.Bank, Inc. grew 717 percent last year with revenue of $19 million, while Atlanta, Georgia-based Security First Technologies grew 124 percent — pumping out $24 million in revenue.
Nevertheless, brick-and-mortar banks say that Internet banking is only a fad that will soon fade into obscurity when customers find they can’t really get the service they need from a cyberspace-based institution.
But isn’t that the same argument old-line stockbrokers have been repeating a lot lately?
What do you think? Let’s talk about it.