eBusiness poses challenge to New Zealand banks

2 May 2000
For immediate release

eBusiness poses challenge to New Zealand banks

If New Zealand financial services institutions fail to exploit the potential of the Internet, they risk being overtaken by those organisations that understand the wider implications of the eBusiness economy, the Chairman of KPMG’s Banking and Finance Group, Andrew Dinsdale, said today.

Mr Dinsdale was speaking at the launch of KPMG’s 14th annual Financial Institutions Performance Survey which reports and comments on the performance of banks, finance companies and other financial institutions.

“More than 50 percent of New Zealanders have access to the Internet and currently 34% use it on a regular basis. So far, ASB has led the market in offering online services, with ANZ, BNZ and National Bank rapidly catching up. More recently, WestpacTrust has begun trialling its Internet service and we expect it will go to a full launch shortly.

“The emergence of ‘knowledge consumers’ has shifted the power in relationships from the supplier to the buyer. Consumer loyalty has lessened as alternatives are literally only a click away.

Mr Dinsdale said that with the notable exception of ASB, New Zealand financial institutions are two to three years behind their international counterparts. The challenge for all New Zealand companies is to ensure that they aren’t left behind by global organisations.
“It is not realistic to expect that Internet-literate New Zealanders will purchase products only from organisations currently operating within New Zealand. Much of the traffic generated by New Zealand’s Internet consumers today is going overseas. The Internet has no borders and New Zealand’s financial institutions must, at the very least, match overseas offers to maintain its client base.

“Already, global organisations such as Charles Schwab, E*Trade and Quicken have announced their intentions to establish themselves more substantially in New Zealand.”

Mr Dinsdale said the adoption of a “clicks and bricks” strategy is imperative for today’s financial services organisations, not just to compete but to exist in the 21st century.

“A bank, an insurance company or a sharebroker are becoming less relevant concepts as we witness the development of strategic partnerships and alliances between both online and traditional organisations – all in the name of adding value to the customer relationship.

“No one knows what New Zealand’s online financial services landscape will look like in the coming few years, but what we do know is that the centre stage is currently vacant. A New Zealand organisation has an opportunity to take the high ground and establish themselves as the destination site for online financial services.”

Ends

For further information contact:
Andrew Dinsdale
Chairman, Banking and Finance Group
KPMG
Telephone 04 802 1214 or 025 437 354

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