While banks are busy trying to act like money market funds, some mutual funds are trying to look like banks.
These fund groups have established walk-in service centers just for shareholders and new customers. The interiors resemble banks, with counters, waiting areas, and ''tellers'' on hand to process deposits and withdrawals, and to answer questions about funds and accounts. The traditional way to make transactions is through the mail or at a fund's administrative office.
Down on Federal Street, in Boston's financial district, the Scudder Funds Center handles a full lunch-hour crowd. The center, which opened at the end of January, is Boston's first street-level fund store. The day's yields and share prices for funds, as well as a basic description of Scudder's nine funds and retirement plans, are posted on large plaques hanging on the wall. Behind the counter sit two fund representatives, ready to handle account transactions and answer questions about individual retirement accounts (IRAs) and the no-load (no sales charge) mutual funds.
Across the street, and up on the 12th floor, the president of Scudder Fund Distributors Inc. talks about the reasons behind the street-level store.
In the past, ''our main business was from (institutional) clients,'' says the president, David Lee. ''But with the advent of our money market fund (in 1974), we have had a huge change in our shareholder complex. . . . Last year we found more and more people coming to our administrative office'' for transactions and information.
Because of this, the fund group decided last spring to open a string of six service centers across the country. Boston's is the only street-level one. The centers have been so successful that Scudder plans to open six more in the near future.
''People aren't just taking literature from the center, but they're coming back with checks,'' Mr. Lee says. ''When I say that to my banking friends, they offer me all their bank branches as potential sites!''
''People tell us that we're much more accessible on the street level,'' says Mary Ann Perkins, a Scudder representative at the center. For many customers, especially new ones, ''it's intimidating'' to call over the phone or visit offices in huge downtown buildings, she explains. ''Here, though, they can ask real, down-on-the-street people about our funds.'' As Lee puts it, the centers are a way ''to rub shoulders'' with everyday people.
For now, the hottest business at the center is in IRAs and money funds. ''But once people come in and see us about these, they also notice and inquire about our mutual funds. We hope to get 'add-ons' to the mutual funds this way,'' Lee says.
Though a first in Boston, the street-level center is not a first in the country. Government Investments Trust opened its street-level center in November 1980 at the corner of Connecticut Avenue and K Street in Washington. Most shareholders of GIT, a no-load money market fund that invests only in government securities, live in the Washington area.
''The genesis of the idea to open a service center came from the large number of people seeking us out at our obscure headquarters (in Arlington, Va.),'' Bruce Cleveland, president of the fund, says. ''We realized people are accustomed to banking in town - that they want to do their business in person, so we opened the center.''
A brisk business at the center led to the opening of others in Chicago, Philadelphia, and one more in Washington.
Mr. Cleveland says the centers were initially a way to offer customers convenience. But now he also sees the move as ''a defensive measure'' against the ultimate phase-out in 1986 of Regulation Q - the law that sets a ceiling on the amount of interest a bank account can earn. ''If money market funds want to continue to hold their customers, then it's important to provide a level of convenience comparable to banks,'' he reasons.
The GIT centers are ''in locations with a substantial shareholder base,'' he comments. ''And of course the centers are for new shareholders, too. We add over 100 new accounts every day.''
Service centers are also catching on in the big league. One of the largest mutual funds, the Fidelity Management Group in Boston, is gearing up for a major move in this direction. Apart from its funds, Fidelity has a brokerage business: Fidelity Brokerage Services Inc. By the end of June the mutual fund group hopes to have 28 service centers at the same locations as its regional brokerage offices.
''At these centers we will be able to handle walk-ins and man the phones,'' says Thomas Despres, manager of Fidelity's investor information. Fidelty already serves 200 to 300 people a day at its sixth-floor walk-in center in Boston.
Mr. Despres views the centers as an essential service to the firm's customers. But they are also ''a way to stay competitive with other mutual funds.''
GIT's Mr. Cleveland has a slightly different view. ''Fund groups don't have to offer these services now, because yields are so high. But in the long run, the public will demand yield plus services.'