Like a car with that withdrawal?
New Zealand banks are eyeing developments in the US where banks have begun selling and delivering new cars complete with financing and insurance.
Westpac New Zealand product head Shane Howell said it was "well aware" of the development and it could follow if there was customer demand.
"We have no plans at the moment, but we will continue to watch this space," he said.
Peter Weill, who chairs a research centre at the Massachusetts Institute of Technology, said the trend was "revolutionising" car buying in the US, although New Zealand's Motor Trade Association doubted that claim.
While car dealers commonly offer finance on vehicles, banks in the US had now realised that when customers came to them for a car loan what they were really shopping for was a vehicle, Weill said.
The United Services Automobile Association (USAA) had led the way with an iPad and iPhone app called Auto Circle, he said. The USAA is a full-service bank that offers a broad range of financial services to US military personnel and their families including bank accounts, ATMs and mortgages, and as such bears little resemblance to New Zealand's Automobile Association.
"What the USAA and other banks around the world have said is ‘we will negotiate the price of the car and deliver it to you and include the loan, warranty and the insurance'," Weill said.
"Say you want to buy a Mini Minor; you go to the iPad app and it helps you pick a car and the colour, asks you how much you want to pay in cash, gives you a monthly price that includes insurance and warranty, says it will deliver in three days, and you say ‘yes or no'."
Weill said the USAA was able to employ professional negotiators who might buy 100 cars a day from manufacturers on behalf of their customers. The USAA claims on its website that it has saved members an average of US$3127 off car manufacturers' recommended prices.
USAA spokesman Steve Alvarez said it had sold about 400,000 vehicles through Auto Circle since the service launched in 2010.
Auto Circle was just one example of a new type of "digital ecosystem" that threatened traditional businesses in a range of industries, Weill said.
Westpac's Howell said technology was "changing business models every day and we have got to think a lot more laterally".
"For us it all comes down to meeting customer expectations." But he acknowledged the possibility of going to a bank to buy a car might not have occurred to many people. "You don't know what you don't know."
Motor Trade Association spokesman Ian Stronach said it received daily updates from the National Automotive Dealers Association on developments in the US market and was not aware of competition from banks becoming a major threat to new car dealers.
"Everyone wants costs out. The difficulty with a car is the post-sales process is important. What do you do if you car springs a leak; do you take it back to the Westpac branch? We run a mediation centre here and emotions get very high when things aren't going right."
That said, there had been a trend over the past few years for vehicle manufacturers to sell more vehicles direct, Stronach said. Toyota had decided to only sell its new 86-model sports cars direct online in New Zealand, for example.
The US car market was "on fire" with 15 million new cars sold last year, so it was also possible some inroads by the USAA might go unnoticed, he said.
Weill met with Internal Affairs Minister Chris Tremain during his visit to Wellington. Internal Affairs, Westpac, ASB Bank's owner, the Commonwealth Bank of Australia, and Wellington information technology firm Equinox all sponsor the Centre for Information Systems Research at the MIT's Sloan School of Management, which Weill chairs. This year Internal Affairs is paying the centre US$45,000 for access to its research and experts.
An ASB Bank spokeswoman said it was not looking at launching any product similar to Auto Circle.
"Our approach is to facilitate customers purchasing assets like cars and homes, not to sell assets directly," she said.
- Sunday Star Times