
By Stacy A. Anderson
Special to washingtonpost.com
Friday, June 2, 2006; 12:26 PM
http://www.washingtonpost.com/wp-dyn/content/article/2006/06/02/AR2006060200783.html
Brittani Riddle, a sophomore radio production major at Howard University, visits a Web site periodically throughout the day — once in the morning on her personal laptop at home; another time on her sidekick while sitting through a dull afternoon poetry class; and again on her laptop after making purchases from a Giant grocery store.
Riddle is not visiting the social network Facebook or Web mail. The focus of her obsession is the Bank of America Web site, where she checks the fluctuating balance of her CampusEdge account throughout the day.
“It saves me the trouble of having to go to the bank. I can see what’s going on with my account before I make a purchase,” she said. “Since I don’t live at home any more, I don’t get my statements, and it’s easier for me to see them online.”
Riddle’s is the most plugged-in generation in history, and its affinity for the online world extends to money matters — in particular Internet banking.
“I have only spoken to a bank teller twice in my life,” said George Washington University graduate student Danielle Duffy. “I do all my banking, transferring, withdrawing and depositing via the Internet or ATMs. I only use my checkbook for my rent — but even my apartment complex has begun an online rent-paying system.”
Several experts say banks have always targeted college students but are pushing harder in recent years with more innovative features geared toward the younger generation.
John Burnett, an associate editor for BankersOnline.com, an online banking network that received 2 million user “hits” in one day for the first time in March, said bank efforts to capture college student customers have changed drastically over the years.
“Back when I was in college, banks typically went after college students with credit card deals, where as now the interest is in checking accounts,” said Burnett, who handled operations, regulatory and legal compliance at Cape Cod Banks and Trust for more than 30 years.
“The focus has shifted completely to a depositing relationship with college students. … [Banks] don’t have to put up as much to attract students. They don’t need as much of a staff and branching network.”
Point and Click
According to a survey released in April by Reston, Va.-based ComScore Networks, the number of consumers who use online banking has increased by 27 percent since last year. It’s no surprise that a large number of this percentage include college students, since most student accounts feature free online banking and free bill pay.
A 2005 survey on financial literacy programs by the Customer Bank Association found that 86 percent of banks surveyed target the general student population and 41 percent use the Internet for college student financial education.
“What is new is more banks have more means to deliver,” said Andy Zavoina, who has worked in banking and finance for 23 years. “The ‘Nintendo era’ has graduated and banking institutions are trying to graduate with them.”
Zavoina, executive vice president of the Glia Group, Inc. and a BankersOnline.com “guru,” said today’s society is more susceptible to instant service.
“The real difference between my father’s generation, who wanted to shake [their] banker’s hand, and people today, who want to see their account online, is many people are not interested in the one-on-one banking anymore,” he said. “We’re heading to a cashless society.”
Elizabeth Jia, a junior broadcast journalism major at the University of Maryland at College Park, has seen the difference in the generation gap.
“My family members prefer the old-fashioned way of ’snail mail,’” Jia said. “On occasion, my parents will access their account information through an automated phone system from the bank.”
The younger generation’s use of online banking has been a natural progression of the times, said Catherine Palmieri, managing director for Citibank.com.
“They grew up with a computer and are comfortable using it. They have contributed to the popularity of online banking,” she said.
Citibank is keen to attract more online customers, even though 51 percent of its checking customers already use the Web site. Citibank recently launched a new service that allows a customer to go from applying to becoming a customer to seeing an account balance all in a six- to seven-minute online session.
Palmieri said Citibank plans to allow clients to bank by mobile phone and Blackberry later this year.
“Particularly, over the past several years, online banking has become a mainstream product that appeals to the broader consumer market,” said Betty Riess, a spokeswoman for Bank of America. “Students are a natural part of the market because of online access.”
Hook In Early
Jia, who opened a checking account with Chevy Chase when she was 18, can attest to the effort of several banks to attract student customers. “Banks have solicited mail about credit cards and also called my dorm to ask if I would like a credit card.”
BankersOnline.com’s Burnett said financial institutions are also trying to attract students before they acquire more expenses.
“Banks think it’s important to start cementing a deposit relationship when the demands are relatively few, as a college student graduates and moves to other aspects of life, trying to cement other relations like home mortgages, in order to get as many roots into the financial institutions,” Burnett said. “The more accounts that a given customer has, the harder it is or [more] reluctant they are to move.”
Duffy has been a Bank of America customer since her freshman year at GWU. She is like many student customers who remain with the same bank after completing undergraduate studies.
“I used to have a student checking account, but I just switched over to a different type of account so I wouldn’t be charged $5 a month,” she said.
Many people associate students’ desire for quick results with a perceived lack of good financial sense. But the idea that most college students are risky clients has diminished as more banks take them on as lifelong customers.
“I do recall that I was terribly irresponsible with money when I was a college student, but I wouldn’t want to paint all students with the same brush,” Burnett said. “Some students are very thrifty — good money managers.”
Jia considers herself a responsible banking customer.
“Most college students are on a tight budget. They don’t spend unless they really want to,” she said. “I think the only college students who cannot handle the money are the ones who don’t have a set budget, and their parents or guardians fund everything without boundaries.”
Jia believes good financial habits are essential for customers of all ages. “I don’t think anyone wants to have bad credit or be in debt.”
Students form money-management habits during college years, Burnett said. “Banks that seek after them as clients are betting that a fair percentage will develop good and loyal banking habits.”
Still, some banking packages offered to students reflect an awareness of risk. Bank of America’s “Stuff Happens” feature, which allows a student to receive a one-time refund on an overdraft or nonsufficient funds (NSF) fee, an overdraft protection transfer fee, a stop-payment fee, or another bank’s ATM fee.
Burnett said the “Stuff Happens” offer is more like a freebie or first-time-offense refund.
Web guru Zavoina agreed. “I would believe that every bank that has charged an NSF fee has refunded an NSF fee. We did it for customers all the time. … Bankers realize that some mistakes do happen.”


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