AMP Banking launched a free PC internet banking "initiative" to lure customers online for home loan applications, a press conference heard yesterday.
The AMP Banking Home Loan PC Package gives customers an IBM Aptiva personal computer worth $1699, free installation, 30 days of technical support and internet connection offers from Telstra, Optus and AOL. IBM will deliver the PCs direct to customers.
However, the offer is loaded with up-front conditions. The bundle is only available for applications of $100,000 or more and customers must open an AMP credit card or AMP Banking cash management account. Moreover, should a customer settle their loan within three years, they are required to foot a $1000 bill towards the cost of the PC.
"I'm not sure if I'd say it's a gimmick," said Michael Guggenheimer, head of AMP Banking Australia. "We want to add value for the existing customer."
AMP Banking refused to provide customers with free internet access under the deal, saying "we did not find a single ISP to suit our customer's needs". The official line then shifted to: "The customer is not funding this offer. We are funding it."
Despite AMP's prediction that the bundle would attract an "incremental increase" in applications for the deal, executives would not disclose how much they had budgeted for to meet demand. "We will continue to fund for the market," Guggenheimer said. AMP Banking's home applications for June generated $120 to $130 million in earnings.
AMP Banking will charge a flat application fee of $600. The cut-off for applications is September 30.