Two Banks Team Up to Sell Software : Finance: B of A, NationsBank will buy Meca to bolster home banking operations, fend off computer company rivals.

Aiming to expand their fledgling home banking operations and defend their turf against Microsoft Corp. and other potential rivals, BankAmerica Corp. and NationsBank Corp. on Wednesday jointly announced that they will buy Meca Software Inc., a major publisher of personal finance software.

BankAmerica and NationsBank, the nation’s second- and fourth-largest banking companies, respectively, said they will begin selling Meca’s Managing Your Money program directly to their customers as early as this fall.

The software will enable consumers to pay bills electronically, download statements and update their household budgets via computer modem, using up-to-the-minute information from their checking, savings and investment accounts.

The two banks, 50-50 partners in the $35-million deal, said they will soon invite other financial institutions to buy a stake in Meca.

Meca, based in Fairfield, Conn., is currently owned by H&R; Block Inc., which purchased MECA in November, 1993, for about $45.4 million.

Block had hoped--vainly, it turned out--to develop synergies between Meca and its CompuServe on-line information service.

Analysts see the banks’ move as partly defensive.

“Non-banks are increasingly inserting themselves between banks and their customers,” said Edward Neumann, a consultant with Furash & Co. in Washington. For example, when AT&T; offers credit cards, it is piggybacking on the payment system developed by banks.

But Microsoft may be the would-be competitor that bankers fear most.

The Meca deal comes as a Justice Department antitrust lawsuit has at least temporarily blocked Microsoft’s $2-billion bid to acquire software publisher Intuit Inc., whose Quicken is far and away the leading personal finance program, with 70% of the market.

Microsoft owns Windows, the computer-operating system used by the majority of personal computer users, and integrating Quicken with Windows could widen the product’s reach to millions of new consumers.

Further, Microsoft will soon introduce its Microsoft Network, an on-line service to rival Prodigy, CompuServe and others. With those three pieces in place, Microsoft could become the dominant channel for personal financial management through the computer, collecting a fee on every transaction.

“If that happened,” Neumann said, “whenever banks wanted to access their customers, Microsoft could dictate the terms.”

Ballyhooed for years as the next big thing in finance, home banking is still a long way from becoming a major part of the financial services scene. Only about 1% of all bank transactions are believed to be handled through home computers, according to a 1994 Ernst & Young study. However, the study projects that the figure will rise to 6% by 1997, and the main users of the service will be the banks’ wealthiest and most desirable customers. The banks do not want to lose them.

“I conduct most of my banking using ATMs these days, and I don’t care whose ATM I use,” said Jesse Berst, editorial director of Windows Watch, a software industry newsletter. “That means I no longer have a relationship with my bank.

“Bankers are worried with electronic banking that the relationship the consumer has is with Intuit or Microsoft and not with the bank,” Berst said.

“The ability to allow the customer to continue banking relationships and services already in place is one of the most attractive features of (Meca) products,” said NationsBank Executive Vice President G. Patrick Phillips.

Numerous banks, including Bank of America, already have on-line services. New York’s Citicorp, the nation’s largest bank, has developed its own money management software, available for the home PC or with a small-screen computer linked to a telephone.

Chase Manhattan, in a deal struck last year with Microsoft, offers Microsoft’s Money personal finance software to facilitate home banking by computer. Money, a distant second in popularity to Quicken, would be sold to Novell Inc. if Microsoft succeeds in buying Intuit. Meca’s Managing Your Money claims third place among personal finance programs, with 600,000 users.

Bank of America, based in San Francisco, currently offers customers a way to link their own personal finance programs with their bank accounts, and Vice Chairman Thomas E. Peterson said the Managing Your Money program will enhance that service.

NationsBank, based in Charlotte, N.C., has a big presence throughout the Southeast and in Texas.