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Internet Banking in Europe: a comparative analysis

Author

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  • Francesca Arnaboldi

    (Dipartimento di Economia, Università di Milano)

  • Peter Claeys

    (Faculty of Economics, University of Barcelona)

Abstract

A key strategic issue for banks is the implementation of internet banking. The ‘click and mortar’ model that complements classical branch banking with online facilities is competing with pure internet banks. The objective of this paper is to compare the performance of these two models across countries, so as to examine the role of differences in the banking system and technological progress. A fuzzy cluster analysis on the performance of banks in Finland, Spain, Italy and the UK shows that internet banks are hard to distinguish from banks that follow a click and mortar strategy; country borders are more important. We therefore explain bank performance by a group of selected bank features, country-specific economic and IT indicators over the period 1995-2004. We find that the strategy of banking groups to incorporate internet banks reflects some competitive edge that these banks have in their business models. Extensive technological innovation boosts internet banking.

Suggested Citation

  • Francesca Arnaboldi & Peter Claeys, 2008. "Internet Banking in Europe: a comparative analysis," IREA Working Papers 200811, University of Barcelona, Research Institute of Applied Economics, revised Sep 2008.
    • Handle: RePEc:ira:wpaper:200811
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    File URL: http://www.ub.edu/irea/working_papers/2008/200811.pdf
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    References listed on IDEAS

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    Keywords

    Banks; Internet; Innovation.;
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