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Privacy Concerns Hamper Online Prospects

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A study that rated the online treatment of consumers found many mortgage Web sites may be losing prospects because of privacy concerns. While E-LOAN ranked highest — several of the nation’s biggest mortgage players did not make the cut.

Those findings were outlined in the First Quarter 2005 Online Customer Respect Study of North America’s largest Financial Services firms, according to an announcement Monday by the study’s conductor, Customer Respect Group.

The international research and consulting firm, which focuses on how corporations treat their customers online, based the study on interviews of a representative sample of the adult Internet population, and on analysis of more than 2000 corporate Web sites.

A company’s overall Customer Respect score was compiled by combining the measure of six attributes that create the entire online customer experience: simplicity, or ease of navigation; responsiveness; privacy; attitude, which refers to the customer-focus of the site; transparency (open and honest policies); and principles of valuing and respecting customer data.

The Internet financials category scored the highest in online customer satisfaction for the first quarter. E-LOAN, which had the best score of all financial service sites, topped this category, followed by LendingTree and Netbank.

Fleet Bank, which was acquired by Bank of America in 2004, snagged the top spot in the commercial banks list. Comerica placed second and JP Morgan Chase third.

Capital One Financial was No. 1 in the ranking of three credit card suppliers, and MBNA No. 2. Both companies have mortgage units.

The diversified financials list crowned American Express, which originates mortgages through American Express FSB. GE Home Fiance parent, General Electric, came in at No. 2, followed by Fannie Mae.

The site of World Savings Bank took the gold among three savings institutions. The silver medal went to Sovereign Bancorp and the bronze to Washington Mutual.

Amongst securities companies, the No. 1 slot was filled by A.G. Edwards, which provides mortgages through Nexstar Financial Corp. Parent of Schwab Bank, Charles Schwab, was No. 2, and third was Goldman Sachs. Morgan Stanley scored lowest.

Overall, the sector improved its performance in the six areas over the past study. For example, in the area of responsiveness, the percentage of unanswered online inquiries dropped from that in the third quarter 2004, the research group said.

However, the study reportedly showed that 43 percent of the surveyed firms share personal data with business partners or third parties, one of the highest industry percentages measured. While the percentage fell from 59 percent in the second quarter 2004 report, it is still much higher than the 24 percent all-industry 2004 average. “This is an area of major concern that surveyed firms should address immediately,” the researchers said.

“Financial services firms are doing considerably better than other surveyed industries,” said group president Terry Golesworthy in the announcement. “But you can’t ignore the fact that almost half of financial services firms are sharing personal data without permission. Web users have repeatedly told us that the security of their personal data is one of the most important aspects when choosing vendors and Web sites. Financial services firms may already be losing business because of this issue; if not, it may only be a matter of time as consumers become aware of it.”

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