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INSEAD First Direct: Branchless Banking INSPECTIONNot For Reproduction COPY 01/97-4660 This case was prepared by Delphine Parmenter, Research Associate, under the supervision of Jean- Claude Larréché, Alfred H. Heineken Professor of Marketing, and Christopher Lovelock, Visiting Professor, at INSEAD. It is intended to be used as a basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation. Copyright © 1997 INSEAD, Fontainebleau, France. INSPECTIONNot For Reproduction COPY INSEAD 1 4660 In October 1996, seven years after it first opened outside Leeds, England, First Direct was still attracting attention as an innovator that operated a bank with no branches. Intrigued by its success, financial service providers wanted to understand how unseen customers conducted business around the clock over the telephone. An article in the New York Times reported: Representatives from banks around the world are making the pilgrimage to this industrial city in the north of England for a glimpse of what might be their stagnant industry’s equivalent of a miraculous cure. For not only is First Direct the world’s leading telephone-only bank, it is the fastest growing bank in Britain. In just six years, it has signed up 2% of Britain’s notoriously set-in-their-ways banking subjects, who call its rows of bankers 24 hours a day, seven days a week, toNot pay bills, For buy Reproduction stock, and arrange mortgages. September 3, 1996 INSPECTIONSuccess not only put First Direct COPY in the media limelight but it also helped to maintain high levels of enthusiasm, pride, and motivation internally.
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