HSA offers Financial Institutions Significant Opportunity, says Survey
This entry was posted on 1/24/2008 10:46 AM and is filed under Deposits.
MINNEAPOLIS, January 23, 2008 /PRNewswire/ — A majority of the nearly 1,200
financial institutions responding to a recent Wolters Kluwer Financial
Services survey say they are offering their customers Health Savings
Accounts (HSAs) and that the top reason they are doing so is customer
demand.
Sixty-two percent of the survey's respondents, a majority of which
were community banks and credit unions, said they are offering HSAs
while more than one in three of the respondents who said they weren't,
are planning to do so in the next three months.
Customer demand topped the list of reasons institutions began
offering HSAs (80 percent). Second on the list was the ability HSAs
give them to generate new accounts (58 percent), with increasing
cross-sell opportunities (51 percent) and growing revenue (51 percent)
also noted as significant reasons.
Of the nearly 1,200 financial institutions surveyed, approximately
24 percent said they had no plans to offer HSAs or weren't sure of
their plans to do so. These institutions cited customer demand, lack of
understanding of HSAs and lack of management interest in offering HSAs
as reasons.
While HSAs are growing in popularity with financial institutions,
customers are still in the early stages of adoption, which may explain
why customer demand is cited as both the number one reason institutions
began or have not yet begun offering HSAs. The majority of institutions
responding to the survey reported a small number of HSA accounts.
Sixty-nine percent of respondents reported 100 or less HSA accounts, 18
percent reported 101 to 500 accounts and seven percent listed more than
500.
"Banks and credit unions know HSAs present them with a significant
business opportunity and additional way to better serve their
customers," said Dave Roy, vice president and general manager, Banking,
Wolters Kluwer Financial Services. "But it's also evident that this
market is still relatively untapped, and the greatest potential lies
ahead, especially as healthcare costs continue to climb and consumers
look for more effective ways to save and finance those costs."
Source: Wolters Kluwer Financial Services
