Historic Alliance Paves the Way for Virtual Banking on the Internet

Strategic Insights -

First Union Corporation and MCI Communications Corporation have entered into an unprecedented partnership to revolutionize the banking industry on the Internet. The joint venture aims to provide First Union customers with simple and convenient access to the Internet, allowing them to perform banking transactions, browse the web, and access a wide range of information and services. This innovative alliance marks a significant step towards making the Internet a powerful consumer banking tool in the 1990s.

Key Takeaways:

  • The 18-month market test will provide First Union customers with personal computer software disks that connect them directly to a custom-designed First Union Internet home page, enabling them to access various banking applications and services.
  • The software package, valued at over $75, will be provided free of charge to First Union customers, with usage fees billed at $9.95 per month for the first five hours of Internet access, and $2.50 per hour for additional hours.
  • MCI will provide First Union with a "private-labeled" Internet Netscape browser for distribution to its customer base, as well as manage the network, fulfill and distribute customer orders, and provide high-quality customer service 24/7.
  • The partnership will also link the web sites of MCI and First Union on the Internet, enabling customers to access both sites from a single point of entry.
  • First Union customers will receive the best browser available in the market and the security of one of the nation's most reliable telecommunication networks, courtesy of MCI's extensive Internet experience and technological infrastructure.
  • The joint venture marks a significant step towards making the Internet a powerful consumer banking tool in the 1990s, as predicted by Vinton G. Cerf, MCI senior vice president for data architecture, and the industry-recognized "Father Of the Internet".

Statistics:

  • First Union Corp. is the nation's ninth-largest bank holding company with more than $83 billion in assets and 1,300 branch offices in eight southeastern states.
  • The company plans to roll out enhanced commercial and consumer banking applications on its home pages in the fourth quarter.
  • MCI, in a joint venture with News Corporation, recently launched a new Internet-based online services joint venture to provide an array of cyber services for consumers and businesses.
  • MCI offers consumers and businesses a broad portfolio of services including long distance, wireless, local access, paging, Internet software and access, information services, business software and advanced global telecommunications services, with annual revenue exceeding $13 billion.

Sources:

  • First Union Corporation
  • MCI Communications Corp.
  • Netscape Communications Corporation (MCI/First Union press release, August 29, 1995)