Managers at one of Slovakia's most successful banks, Tatra banka, are hoping they have stolen a march on sector rivals following their launch of the first e-bank in Slovakia, eliot, on June 5.
The virtual bank, which on June 13 already had 9,000 clients, is, according to Tatra banka chiefs, designed to plug into an e-commerce market in Slovakia and principally the capital Bratislava, that is set to take off.
"The time is right for an e-bank," said Philippe Moreels, member of the board of directors at Tatra banka. "A lot of people have been talking about e-commerce and the Internet for a few years now, and a lot of people have been in contact with us. In Bratislava the number of people wanting to use the Internet for buying and ordering things is moving up - e-commerce is really taking off," he said.
"Eliot's future is closely linked to that of e-commerce [in Slovakia]. It hasn't just been created to make immediate profit. While we don't expect that at the end of the year all our clients will be the same as they are now, we are anticipating 10,000 active clients by then and a total of twice that number registered."
On the first day of operations the bank's server was clogged for 15 minutes after the eliot website registered more than 10,000 hits. Analysts have agreed that the time is ripe for the introduction of virtual banking onto the Slovak market with recent surveys suggesting that more than 200,000 people use the Internet in Slovakia every week.
Martin Barto, director of strategy at the country's largest bank, Slovenská sporiteľňa (SLSP), said that the growth in Internet in Slovakia would fuel competition in a future e-bank market.
"There should be strong competition and an expanding demand for Internet banking over the next few years. There is a need for it. I think people will be surprised at the use of the Internet in Slovak households," he said.
"The penetration of the GSM network and mobile phones was very rapid and that took people by surprise. I think you could see a repeat of that with the Internet."
Rival banks are expected to follow Tatra banka's example and begin offering Internet banking. However, Moreels believes that the long-term strategy for eliot will keep it ahead of any future competition. "I think our competitors are probably angry that we were the first bank to do this. They made the classical error of mistaking the technology for the product."
Moreels said that eliot was not designed to be a bank that people would automatically switch all their accounts to, but one which would complement existing accounts and allow people to latch on to potential e-business and e-commerce opportunities.
"This is a whole new opportunity for people. A number of large banks in Slovakia don't have anything on the web, but people don't like to change their bank accounts. With eliot we aren't asking them to do that, what we're saying is go ahead, try it," said Moreels.
But Barto claimed that the media attention given to the launch of eliot drew attention away from the fact that Internet services are already offered by many banks.
"Eliot received a lot of marketing and media attention. Other banks already have these services - large banks do. Major banks are ready for this [type of banking] and really eliot has just had massive propoganda," he said.
Tatra banka has been keen to show off the new bank as a separate brand on its own. Moreels emphasised that while eliot was legally a part of Tatra banka, the two banks would be aiming at very different markets.
"Eliot is a different brand [to Tatra banka]. Don't be surprised if you see ads appearing on eliot but not on the Tatra banka web page. Tatra banka will be the more 'serious' bank, while eliot will be aimed at a more Internet-age market."
The future success of eliot will be under careful scrutiny. A similar venture in the Czech Republic with Expandia banka's Internet banking, launched more than 18 months ago, although initially expected to be a run-away success has not drawn the attention or client volumes it had hoped for.
"People in Slovakia can be sometimes a bit conservative," said Miloš Božek of J & T Securities in Bratislava. "Tatra banka is a major bank and will give a lot of marketing support to eliot so it may bear fruit. However, it will take time for some people to move over to Internet banking."
