Woolies To Sell Loans, Insurance And Travel

Sydney Morning Herald

Tuesday March 7, 2000

By MARK TODD

Woolworths is seeking to augment its new in-store banking strategy with additional services such as home loans, insurance, and travel.

However, the retailer believes the initial Ezy Banking offering, done in partnership with the Commonwealth Bank, could take up to four years to make a noticeable impact on its financial performance.

``We serve 12 million customers a week. It will be a fair while before it starts to have a macro-effect upon the whole turnover of Woolworths," chief executive Mr Roger Corbett said.

Despite that, customer traffic has increased at stores offering Ezy Banking, launched in July 1998.

``On customers we have polled and measured, it has a very significant increase in their use of Woolworths stores," the chief executive said.

Woolworths will probably offer any further new services via the Internet, leveraging off the presence established by Ezy Banking.

``As we go along I think the other services will reinforce the banking service. They will work together," Mr Corbett said yesterday at the Sydney launch of Ezy Banking.

Woolworths would continue to use the Commonwealth Bank to offer financial services, he said, while indicating that Woolworths is working as well on a travel service, although he declined to name potential partners.

The chief executive did not give a timetable for the introduction of the additional offerings, instead saying that the retailer wanted to first conclude the initial expansion of Ezy Banking and start amortising the investment.

The Ezy Banking offering includes traditional personal banking services and a reward points program, accessible either through Woolworths stores, the Internet, or over the phone. So far, Woolworths has contributed $10 million to the Ezy Banking joint venture, mostly in training staff. Spending on the in-store kiosks is only minimal.

There are Ezy Banking kiosks in 107 Woolworths stores in Sydney and 356 stores nationwide. The joint venture partners plan to have Ezy Banking kiosks available in 640 stores by June.

On the general retail environment, Mr Corbett said he had not detected a change in trading conditions despite recent official data suggesting a slowdown.