Microsoft, Visa Form Alliance To Challenge Intuit Venture Enables Customers To Pay Bills Electronically Directly From Bank Accounts

Microsoft Corp. is teaming with Visa International to provide on-line banking services in an attempt to loosen Intuit Inc.’s vise grip on the personal-finance software market.

The top software and bank-card providers said Wednesday that Visa will offer quick payment-processing services to Microsoft Money software users who link up with their banks to handle tasks such as bill payments and balance inquiries.

Brent Robinson, a senior vice president at the credit-card concern’s Visa Interactive unit, said the new service will give customers an option to have bills paid electronically, with their money directly taken from their accounts.

Most other payment processors write a check in the customer’s name, which takes longer to process and is more expensive, he said.

In addition to allowing Microsoft to peck away at the dominance of Intuit’s Quicken software, the deal could let Visa snag some of Intuit’s processing business. Intuit currently provides all of the processing services for both Money and Quicken and will continue to do so.

If the deal is approved by the credit-card concern’s board next month, Visa will begin offering its services on Money by the summer. Visa will collect a monthly fee based on the number of subscribers. Customers’ rates for the services are determined by their banks.

Currently, 19 banks provide online financial services via the Money program out of a total of 31 that have committed to working with Microsoft. Visa has 19,000 member banks worldwide and 90 that are committed to providing on-line services.

Matthew Cone, a Microsoft business development manager who works on Money, said only that the company expects “dramatic growth” in the number of banks that will align with Money. He wouldn’t comment on whether the company is seeking deals with other processors.

Redmond, Wash.-based Microsoft is trying to make further inroads into the on-line banking market after its attempt to buy Intuit was dropped last year because of antitrust questions.

Quicken accounted for 81 percent of all personal-finance software sold last year, while Money stood a distant second at 10 percent, according to market research firm PC Data.

“Microsoft has been trying to break into this market for some time now … and Intuit just can’t let go,” said Ann Stephens, president of the research firm.

An Intuit spokesman didn’t express concern about the deal being an immediate threat.

“The difference is that Visa is only a processor and Intuit is both the processor and the producer,” said Bob McCarson, an outside spokesman for Intuit.