With the approval of the People's Bank of China, the three banks can offer Internet-based services including account inquiries, capital transfer, inquiries about exchange rates and interest rates, opening fixed-term deposit accounts, ordering check books and upgrading individual data.

With the development of the information industry, on-line banking systems which offer lower costs and better services have become popular around the world.

From 1997 to 2000, investment in Internet-based banking services increased by about 36 percent year-on-year in the world's financial institutions.

E-banking covers 20 percent and 12 percent of Hang Seng Bank and BEA's total business respectively.

"Because of the gap in the number of branches between us and local banks, it is difficult for us to compete with local banks in traditional trade," said Ji Yunbing, vice director of the BEA's Shanghai branch. "So we hope to narrow the distance between us and our clients through the Internet."

After China's entry into the WTO, domestic banks face fierce competition from their overseas counterparts. The emergence of e-banks is a convenient way for overseas banks to overcome their disadvantages, which will help them take more of China's market, said Sun Weidong, a manager of the Industrial and Commercial Bank of China.

(eastday.com January 6, 2003)