Consumers are not flocking to use online financial services, despite companies investing billions of pounds in new systems and services, finds a survey by Deloitte Consulting.

Its report Myth v Reality in Financial Services 2000 finds two thirds or more of consumers still do not rate online services as important in their relationship with their bank either now or in the future. Of those who did, usage was low at only 22%.

Roger Magid, Head of Deloitte Consulting's European Insurance Practice, said the results put into doubt the stratgies of many UK insurance companies.

Nearly two-thirds (63%) of UK consumers surveyed rated a responsive service and being treated as a valued customer as the most important factors in driving their overall satisfaction.

Many consumers think the new distribution channels lack the personal touch that used to be provided by the local branch.

"It would be unwise to concentrate a large chunk of your resources on developing the net," he said.

"You will be missing out on the evolution of the customer.

"The older the customer, the more likely that they will still want to deal with a salesman face-to-face.

"The internet will suit only certain products and certain customers.

"For the rest, it is more important as a servicing tool rather than for distribution."

Today's report findings are in stark contrast to a previous Deloitte Consulting, Competing for Your Customers – The Future of Retail Financial Services 1998 survey of financial services executives who predicted high consumer expectations of online access to information and products.

One of the key findings of the previous survey was that 41% of the executives surveyed believed that the internet would be of primary importance by 2003.

"Financial services organisations are now caught in a classic cost trap," says John Reeve, financial services specialist at Deloitte Consulting.