The study examined the online banking trends and market dynamics of almost 9000 online adult users across Canada, and found that banks are achieving an extremely low penetration rate for Web-based transactions. Only one per cent of respondents have obtained mortgages online, 2.4 per cent of respondents applied for a loan online, and only 2.1 percent purchased investment products over the Web.

Don Rolfe, managing director for GomezCanada says a surprising number of institutions still require physical-world activities to fulfill certain basic requirements that could be more efficiently handled over the Internet. He says: "Banks will need to offer innovative features, increased breadth of products, pricing advantages, and higher customer service levels, in order to give their customers a compelling reason to move their banking relationships online."

A majority of those surveyed - 54.9 per cent - use the Internet to view account balances, while 44 per cent had paid bills and 38.5 per cent had used the Internet to transfer funds. Fifteen percent said they had applied online for a credit card, and seven percent had used those cards for online purchases.

The report further identifies three waves of future active Web bankers: 'banking shopper', 'innovation seeker' and the 'latent adopter'. Gomez identifies the banking shopper as the greatest near term market opportunity for banks in the first wave. Members of this group intend to begin banking on line within the next six months, with many currently revealing that they are shopping for an Internet bank.