US-based online operators NetBank and Ameritrade have entered a strategic alliance to promote each other's products to new and existing customers. NetBank will offer banking services to Ameritrade's more than 1 million brokerage customers, and Ameritrade Holding Corporation, through its subsidiary AmeriVest, will offer reciprocal brokerage services to NetBank's customer base.
Under the agreement, each new Ameritrade applicant will have the opportunity to apply for a NetBank current account without having to enter any additional information. As an incentive, approved applicants will be paid a bonus for funding their new NetBank accounts. In a separate marketing effort, Ameritrade's existing customers will be offered a similar incentive.
Additionally, NetBank customers will be offered discount brokerage services through AmeriVest with no account setup or maintenance fees, and automatic transfer of idle cash from their brokerage account to their FDIC-insured, high-interest NetBank current account.
D.R. Grimes, NetBank chief executive officer, says: "This agreement allows NetBank to market to a huge community of online consumers whose profile is very similar to NetBank's own customers - financially active online, high-balance customers."
Grimes also points out that the bank's agreement with Ameritrade will help the bank maintain low account acquisition costs. "Our account acquisition costs are already among the lowest in the industry," says Grimes. "Pay-for-performance programmes through affiliate partners are a proven approach to attracting customers at relatively low costs."
Implementation of the programme to Ameritrade customers begins in August. NetBank plans to launch its new brokerage offering to customers during its third quarter.