The findings come from a survey conducted by S1 Corporation and Dove Consulting of more than 7000 US online banking customers from traditional brick-and-mortar banks as well as Internet-only outfits. A typical profile suggests that Internet banking consumers are active online shoppers and online investors, inclined to compare multiple products via the Internet before making a purchase decision.

Survey participants spent approximately 21 hours each week on the Internet, and see online banking as a logical next step. Additionally, 93 percent of online bankers purchase products over the Internet, while 66 percent have established at least one investment account online.

Survey respondents report they have cut in half the times they use branches and live agent interactions; VRU calls among the sample dropped from four calls per month to one call per month.

"This may be a leading indicator of what could finally be a material and growing reduction of transactions conducted across traditional channels," says Chuck Hieronymi, managing director of Dove's eFinance practice. "This finding is supported by another consumer study on Web-enabled ATMs and Kiosks just completed by Dove Consulting, which projects that technically savvy, self-service oriented banking customers expect to significantly increase their use of Internet and wireless channels while materially reducing their use of the branch."

The results further suggest that banks looking to convert customers to the Web must be ready to offer high quality bill payment, customer service and funds transfer capabilities - viewed by survey respondents as critical elements of a successful online offering.

At the same time, 80% of respondents report that they have less than 20 percent of their investable assets at their online banking institution. "This finding suggests that banks still have an enormous opportunity to win in the online banking market - and the place they should focus much of their energy is with their existing customer base," says Hieronymi.