December 02, 2003

Citibank's recent implementation of account-to-account, or A2A, transfers promises to reshape the consumer experience for retail banking, according to Catherine Palmieri, managing director for Citibank.com, who spoke at an industry conference in conjunction with CashEdge (New York), the financial institution's A2A technology provider.

To begin, A2A will allow the account opening to segue directly into account usage. Customers initiating an in-bound transfer from a bank account at another financial institution will be able to bypass the "hold" on the initial check using the A2A service. "Now they can work with their accounts right away," says Palmieri.

While Citibank certainly intends to bolster its demand deposit account client base with this functionality, the service also has value in helping people to fund their investment and money management accounts. "The amount of each transaction has been relatively high, which tells us that they are using [Citibank.com] as a money management hub," says Palmieri. "It transforms aggregation into a meaningful experience."

Furthermore, the benefits will not be limited to the branch and the Internet. "A2A transfers will be expanded into our global ATM network, so that domestic and international customers will be able to move funds between all of their accounts while they're at one of our ATMs," says Palmieri. "You can go to your ATM and manage all of your accounts at all of your financial institutions."

Under the current pricing structure, inbound transfers are free but outbound transfers are not. Accordingly, usage has been skewed towards inbound, which comprise about 75 percent of A2A transactions.

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