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Citi spent years developing a unified platform for electronic statements. Now it's beginning to reap the benefits.
August 15 -
Banks have struggled for years to get their customers to accept paperless account statements. But even among those who have succeeded in such efforts, paper use has risen.
August 12
A number of companies that depend on consumers wanting to turn off paper statements may run into difficulty as banks report their paper-suppression efforts are moving backwards.
Some top banks
These companies promise to facilitate the transition to e-statements by helping consumers organize their bills online. Some ask billers to pay them a cut of the savings when they stop mailing statements.
These vendors won't get that revenue if consumers don't cut off paper completely. The vendors also get revenue from advertising and referrals.
But for these companies to succeed, these revenue streams may not be enough.
"Even if paperless adoption soars, the viability of these firms will rely on somebody being willing to pay for it," says Ron Shevlin, a senior analyst at Aite Group LLC of Boston.
While consumers have flocked by the millions to third-party financial management providers such as Intuit Inc.'s Mint.com, such services are free. Mint has said that referrals are not a continuous source of revenue, since most of the customers who switch accounts do so just once.
"Consumers don't want to pay for [providers like Mint]," Shevlin says. "They don't even want to pay for their checking accounts."
If these vendors are going to make money on paper suppression, banks must overcome consumers' fears over losing access to their financial records, experts say.
Banks don't have consistent messaging across product lines, says Jim Schinella, executive vice president of business development and sales for Manilla Inc. This leaves consumers confused about whether they can access their statements when they need them.
"As a consumer, it is not necessarily clear that the archiving strategies at banks are even the same," Schinella says.
The vendors say their services can actually assist banks in their efforts to help consumers turn off paper by also helping them organize it.
"Banks struggle more than any other industry with the variety of documents they send," says Steve Shivers, chief executive of Doxo, of Seattle.
Still, it's the document storage providers, as much as banks' swamped consumers, who would benefit from the banks sorting out their paper problems.
