The Number of Electronic Banking Users is Growing

Internet and mobile banking are increasingly replacing conventional banking, and bankers are slowly transforming into advisors. The leader in this market is Zagrebačka banka, but other banks also offer various options.

writes Edis Felić
[email protected]

Like ATMs or paying for parking with a mobile phone, electronic banking has become quite normal and accessible to bank clients today. The leader in this market is Zagrebačka banka, which informs us that the reduction in the number of transactions at branches, which today account for about 15 percent of total client transactions, has led to a transformation of their bankers’ roles from transactional-service to advisory. Ivo Jelinović, the Director of Development and Channel Management at Zagrebačka banka, states that today 85 percent of transactions in that bank occur through direct distribution channels (ATMs, Zaba kiosks, self-service payment devices, e-zaba and m-zaba, as well as telephone and SMS banking), and mobile banking services have also been exceptionally well received.

Access to accounts 24 hours
– According to available data tracking internet usage, around 440,000 users utilize the e-zaba service. More than 375,000 individuals use the e-zaba service for citizens, which constitutes over 50 percent of internet banking users in Croatia, while legal entities using the internet banking services of Zagrebačka banka are represented by approximately 70,000 users. According to current data, more than 40 percent of transactions via internet banking in Croatia are conducted through e-zaba – claims Jelinović. E-zaba offers a unique service in the market: an e-payment slip that allows clients to receive pre-filled payment orders for bills from Zagrebački Holding, HT, Vipnet, and Optima Telekom via internet banking (including details about the recipient, payment account, amount, and reference number). Clients decide when to make the payment. Additionally, since 2009, clients have been able to trade securities via internet banking, an e-trade service that enables complete brokerage operations with Zagrebačka banka over the internet.

In the m-zaba service, Zagrebačka banka currently records more than 150,000 users who can use it on over 90 percent of mobile devices available on the market. In April of this year, a mobile banking application for iPhone was also offered. Zagrebačka banka’s market shares in the mobile banking segment are 43 percent in terms of the number of users and transactions, and as much as 92 percent in the amount of payments made via mobile phones – says Jelinović.
Višnja Stipetić-Dokmanović, the head of the Business Systems Development team for direct banking at Hypo Alpe-Adria Bank, lists the advantages of internet and mobile banking: the ability to use services from anywhere in the world where there is internet access, access to accounts 24 hours a day, faster and simpler communication with the bank electronically, lower fees for services compared to those at the bank counter, free downloading of statements, and she notes that their HYPOnet service, besides the Croatian version, is available in English and German.

Savings of up to 70 percent
There are no negative consequences due to typing errors, claims Milja Biondić, Director of the Direct Banking Support Directorate at HPB. She states that for money to ‘move’ via the application, the user must initiate a transaction or transfer and verify it. Each action of this type leaves a trace and can be checked for each individual user regarding what they did and where and how they paid. Accordingly, money cannot disappear. It can only be mistakenly paid to the wrong recipient’s account (the recipient’s account number is entered by the client), but there is always a trace of where the money is and how it got there. In this bank, she adds, they have the highest level of security measures and claims that users of such services can save significantly. Fees for transactions conducted via internet banking are several times lower than those for traditional payments, and certain transactions are free.
– The minimum savings from using internet banking for citizens amounts to 60 percent, while for businesses, savings can exceed 70 percent per order – she says.

Payments via mobile banking are also more favorable, and although HPB does not yet offer this service, they plan to introduce mToken soon (a service connecting to IB via a mobile device that becomes an identification device by installing software support, thus replacing the token). How this looks ‘on paper’ is shown to us by Danijel Mamić, head of the Electronic Banking Service at Erste&Steiermaerkische Bank, who states that every individual or legal entity saves significant time and money by using alternative channels compared to conducting transactions at the counter.
– For example, a company that uses NetBanking for just 50 payment orders monthly achieves an annual savings of about 1,840 kuna compared to traditional payments, while for 1,000 payment orders per month, the annual savings exceed 36,790 kuna. The mentioned calculation refers to the difference in price for orders placed at the branch compared to those placed via the NetBanking service – he explains.

They strive to provide their clients with services and products individually, according to their needs and preferences, which is why they do not offer packages, but rather services for using alternative channels as standalone services that can be contracted. Additionally, they have offered clients the option to contract a third free service related to a combination of electronic banking services (NetBanking, Erste mBanking, and Erste FonBanking). Thus, in March of this year, the redesign project of the Erste NetBanking service was completed. They have improved it with a series of new features that facilitate the use of NetBanking for clients, and among the novelties, they highlight the possibility of using the same user data to access services of different clients if the user wishes (e.g., access to personal internet banking and corporate internet banking using the same username, password, and TAN table), searching transactions by value date, viewing details for each account (opening date, interest rate, credit limit…), viewing details of individual items, submitting requests for purchasing shares in an investment fund and making payments in one step, displaying confirmation of each purchase/sale/exchange of investment fund shares, issuing orders for reversing transactions within the Erste NetBanking application, etc.

Online Lending
PBZ was the first to introduce online business, and it has a whole range of eBanking services specially tailored to the various needs of our clients. From the already ‘classic’ services for internet banking for citizens, craftsmen, and businesses, to highly specialized services such as PBZ Investor (trading in securities), to various technological variations on other platforms (e.g., mPBZ for mobile phones). Today, nearly 200,000 of our clients (citizens and businesses) use these services, which are dominant in some segments compared to other channels. Last year, we introduced a new service: mPBZ (mobile banking). This is an internet banking service specifically designed for mobile phones – says Draženko Kopljar, a member of the Management Board of PBZ responsible for the IT and Operations Group. Soon, they will offer their internet banking users a completely new service in our market – eRačun, which is an independent solution that has been operating in test mode for five months. Additionally, PBZ is the only domestic bank that offers online lending in such a way that the user requests a loan via computer and the internet, for example, 10,000 euros for three years, and the computer immediately indicates whether such a loan can be approved or not. If the loan is approved, the user only needs to enter an authorization code, thereby also giving consent to the terms and immediately receiving funds in their account. Kopljar states that all systems are at the highest level of security.

– In ten years of operation of this service, not a single case of embezzlement has been recorded, nor has there been a single case of a client denying a transaction. For example, in mobile banking, the mobile phone can be protected, but the application is also protected by a personal PIN, which is not stored on the mobile phone. This actually means that neither the theft of the mobile phone nor its loss poses any security risk. For the same reason, cloning devices that exist today for copying mobile phone content do not help here, as the PIN is not stored on the mobile phone – he says. The segment of Internet banking in business with legal entities has also been enhanced by RBA with the introduction of new services or improvements to existing ones. This includes the introduction of new USB devices that enable advanced electronic signatures and access to new electronic services of government administration and public services. Additionally, there is the eBroker service, the e-ToMiTreba!! service, as well as the service for delivering Orders for opening documentary letters of credit – obr. Order 15 via the internet. In any case, this is just a small part of what is currently offered in the banking market. The advantages are significant, security is at a high level, so there is no doubt in the claims of our interlocutors that we have, at least in terms of banking, already stepped into the future.