Nonbanks play an important dual role in the financial system. They complement the role of commercial banks by filling gaps in their range of services. But they also compete with commercial banks and force them to be more efficient and responsive to the needs of their customers. Most nonbanks are also actively involved in the securities markets and in the mobilization and allocation of long-term financial resources. Pension funds and other i

As an employee of American Express Tax and Business Services, I am very familiar with their brand awareness that the corporate offices are using as a major marketing tool. With this and the Internet, American Express has been able to come to the forefront of nonbank on-line banking competition. American Express' on-line bank offers money market and checking accounts, CD's, bill payments, personal loans, and debit cards. To make up for its lack of banking offices, American Express offers rebates of up to $72 per year for automated teller machine surcharges. Other incentives include money market accounts with 5% yields and interest-bearing checking (Souccar, 3). Although individual customers are a large target market for on-line banking institutions, small businesses are another important area of marketing exploration.

The assortment of products and services offered by nonbanks seem to be much more attractive to small businesses than many of the traditional banking alternatives. "A survey conducted by Mentis Corp. has found non-bank organizations generally are doing a better job than banks at targeting the needs of small companies" ("Banks losing small clients", 1). Nonbanks seem to have a better, overall, understanding of the small business market and these businesses are responding accordingly. The computer awareness of small business owners is allowing nonbank organizations to aggressively develop advanced Web pages to support the marketing and communication needs of these businesses. These on-line solutions usually provide transactions capabilities. Kristen Min, research manager for Mentis Corp., explains that part of the nonbank attraction is that, 'unlike banks, these organizations do not have regulatory barriers prohibiting or limiting interest on checking accounts, which has allowed them to offer their small business clients interest-bearing accounts for a number of years' ("Banks losing small clients", 1). Min continues, however, that the small business market is not closed to traditional banks because they already have their proven branch networks and staff interaction, which gives them an inside advantage in understanding small-business clients and selling them other related banking products and services. Also, since nonbanks are new to the business, traditional banks alr

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Approximate Word count = 1559
Approximate Pages = 6 (250 words per page double spaced)