IF will open a new customer contact center in Scotland. The HBOS subsidiary has done well since its launch in late 2000, attracting over 300,000 customers. The key to its success has been to offer the services consumers want, such as telephone banking and integrated products. At the same time, its big real-world parent hasn’t been a disadvantage.
UK Internet and phone bank Intelligent Finance has announced plans to create 600 jobs.
Despite still being some way off its second birthday Intelligent Finance, the Internet banking arm of HBOS, is enjoying considerable success. It now handles more than 327,000 accounts and once the new service center opens it will employ almost 3,000 staff.
Intelligent Finance is not the only one: other UK Internet banks are also not doing too badly. Egg, for example, now has almost two million customers, more than half of whom hold its credit card. Smile, the Internet banking arm of the Co-operative Bank, now has more than 400,000 current accounts.
So what are the secrets of Intelligent Finance’s success? Allowing customers to contact the bank by telephone rather than just online certainly helps. Datamonitor has found the telephone is people’s second most favored way to deal with banking products. Although the branch is the clear favorite – 79% of European consumers say it is their preferred method – the telephone is considerably more popular than the Internet. 11% of consumers prefer the telephone, while just 4% prefer the Internet.
IF’s innovative product offering has also helped. For example, the bank allows its customers to hold any of its five products (savings, mortgages, current accounts, credit cards and personal loans) separately or to integrate them.
Another Datamonitor survey found that consumers see the benefits of integrating their products: 76% of European consumers agreed with the statement I can reduce my overall costs by having multiple services from a single supplier as opposed to buying each one from a different supplier.
Intelligent Finance has therefore, done well so far. Its decision to increase its staffing numbers is both a welcome boost to Scotland and to banking in general especially after Lloyds TSB’s announcement that it was cutting 3000 jobs last week. The Internet-only banks may not be so bad after all. Especially when they have a big real-world parent to back them up.