A NEW report focusing on the impact of changes in financial services forecasts radical alterations over the next 25 years.

The report, prepared by the Financial Services Industry Association and Andersen Consulting, foresees radical changes in consumer trends, with predictions of combined PC, telephone and television systems (multi systems) prevalent in many homes by that time.

Methods of payment will also change significantly, with cash spending being superseded by electronic current account payments.

Banking, insurance, and building society services are expected to overlap, with the consequent emergence of "bank insurers" companies which will offer a complete range of personal financial services.

The delivery of financial service products will also change significantly. These will be driven by consumer convenience and access, with much business conducted from the armchair, the report predicts.

It says that problems with security on the Internet will have been resolved by 2020, with fraud committed by "smart card thieves" dealt with. Smart cards will be the new method of customer paying, with cheques and credit cards long since obsolete.

"Outdoor shopping" will, the report says, mostly take place when people need to get a feel for things. For example, if they wish to go on holiday, they will visit "virtual reality booths" in travel centres, which will allow them to "test the waters" of whatever destination they are thinking of travelling to.

Using a 25 year horizon was chosen because it was seen to be valuable as a tool for concentrating minds on the developing needs of consumers over the intervening period.