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History of Online Banking

HISTORY OF ONLINE BANKING
BROUGHT TO YOU BY YODLEE

Since the early 1980s, innovations
in online banking have made it
easier for people to manage their
money. Banks are offering more
and more tools, information, and
access to financial accounts to
help customers achieve their
financial goals. TowerGroup
Research projects that global
usage of personal finance
management tools will reach 70
million in 2014.

Let’s see how it all started and
who’s using the tools today.

START

1983
The Bank of Scotland otters Nottingham Building
Society (NBS) customers the first Internet banking
service in the UK and calls it “Homelink.’Connecting
via a television set and a telephone to send transfers
and pay bills, this service formed the basis for online
banking as we know it today.

1994
January 1994
OnLine banking is built into
Microsoft Money personal
finance software. 100,000
households begin accessing
bank accounts online.
(Online Banking Report, Jan. 2012)


The Stanford
Credit Union
creates the
first online
banking
website.

2001
Yodlee opens its doors, creating the first account aggregation
software and giving consumers the ability to view all of their
financial accounts in one place.

1 MILLION ONLINE USERS


December 2001
Eight US banks have at
least 1 miLlion online users
each. 19 million US
households are accessing
bank accounts online.
(Online Banking Report, Jan. 2012)

2005
As banking moves online, rules must
shift with the times. FFIEC announces
rules and reguLations for financial
institutions: FIs to carry out risk-based
assessments, evaluate customer
awareness programs, and implement
security measures to authenticate
remote account access.

Direct banks (banks that
operate without a physical
branch) begin to otter their
services primarily online: ING
Direct, PC Financial (Canada),
First Direct (UK), HSBC Direct
and eTrade Bank (US).

ING-DIRECT
President's Choice
FINANCIAL
first direct 4I
HSBC Direct.
E*TRADE FINANCIAL

Consumer PFM portals like
Mint.com start to gain popularity
among users as easy-to-use and
well-designed tools to manage
their finances.

mint.com

2007

Pocket Power
Apple launches the iPhone
and a shift from banking via
personaL computer to banking
via smartphone begins.

2009
54 million
US households
accessing bank
accounts onLine.
(Online Banking
Report Jan. 2012)


Bank branches are consolidating. Ratio of the US population
to bank branches shifts from 9.340 in 1970 to 3.684 in 2009.
Branches are increasingLy less important to consumers and
banking moves to kiosk and online solutions.


RATIO OF POPULATION TO BANK BRANCHES
1970 9.340
2009 3.684


GLOBAL
FINANCIAL
CRISIS

CHANGING CUSTOMER
DEMOGRAPHICS AND
EXPECTATIONS WITH
THE RISE OF GEN Y

• 70 million people in the
US between ages of 15-32

• They prefer debit cards,
are accustomed to online
banking, online purchasing
and live a mobile lifestyle

• Privacy is not a concern

• Consume info in snack-size
and expect instant information/gratification

• Rapidly shifting to mobile
banking, 72 million US
adults will use mobile
banking in 2012
Source: Glenbrook Partners

Genworth data indicates that over 1/3 of consumers
felt some level of financial vulnerability.


40%
Consumers want help
reducing debt and
increasing savings. In
a survey of 3,000
consumers, 40% said
they would benefit
from personal finance
management toots.
(TowerGroup research)


2011
Online banking goes mainstream.
Even late adopters choose to bank online
and according to the American Bankers
Association (ABA), the majority of
Americans aged 55+ prefer online
banking over visiting a branch or ATM.

GLOBAL USAGE OF PFM TOOLS
Number of Users (in millions, 2011)

CAGR 21.09%
--------------------------------->

33 44 53 62 70
2010 2011 2012P 2013P 2014P



2012 --------- WHAT’S NEXT?

Yodlee’s platform touches
35 million people globally.


We’re entering an era of social banking.
There will be a convergence of online
banking, PFM, social networking, payments,
rewards, mobiLe, and gaming. PFM wilL no
longer be just a tool, but an experience and
a platform for insights and innovation woven
into all digital experiences.



Yodlee

History of Online Banking

shared by Lemonly on Aug 02, 2012 in Economy

History of Online Banking

shared by Lemonly on Aug 02, 2012 in Economy

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Online banking. It’s pretty awesome and downright handy! But do you know anything about it’s history? We sure didn’t! We got to work with Yodlee on this fun infographic about the interesting his...
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