By BBC News Online's Iain Rodger

When I told people I was looking forward to a chat with Charles Schwab about the online share trading phenomenon, I was amazed at how many said: "Oh, is he a real person, I thought that was just the name of the company".

Well, he is indeed the man pictured above, who founded the Charles Schwab Corporation in San Francisco almost 30 years ago and has since seen it become the world's biggest online stockbroker.

The corporation is now expanding further through its UK-based European arm, and is forming a network with its US rival, Fidelity, to trade Nasdaq stocks.

It has also recently announced the acquisition of the private banking and investment management firm US Trust, and is in a joint venture with Ameritrade and TD Waterhouse to form an online investment bank.

Growing fast

Schwab came into being as a discount brokerage in 1974, and quickly gained a huge market share by undercutting the established commission-based brokerages.

In 1987 it went public and more recently - boosted by huge demand from private investors for online services - the firm has produced a growth rate described by its founder as "just short of phenomenal".

In the UK, Schwab has a head office in London but its operations are based in Birmingham, where it has 800 employees, and Milton Keynes.

Last month, the company says, it handled about 10,000 transactions a day - almost 9% of all deals on the London Stock Exchange.

Quiet determination

Charles Schwab - who is also a director of UK mobile phone giant Vodafone - is quietly spoken but intently focused on his vision of a future dominated by the internet.

His success is largely based on his recognition before others of the importance of the web, so his views are treated with respect.

He says he has no doubt that the internet will be adopted with increasing speed in Europe, as it has been in the US, and that the constant search for developing cheaper ways of investing will win new markets.

He is not impressed with day trading, which he describes as being "more about entertainment than investment" and does not encourage.

It has to be said that his firm has been instrumental in creating the opportunity for day trading to exist, but Schwab is insistent that the way to make money on the stock market is through long-term investment, and not by taking chances on short-term volatility.

He sees the big rises in stock market values globally as a fair reflection of economic growth and does not believe there has to be a crash: "Markets go up and down - that's their nature".

In fact, he suggests that the recent falling back in the main indices is a kind of correction, and that the continuing rise of high-tech stocks is justified.

In any case, he says, when there are crashes, there is usually a quick recovery and the long-term upward trend continues.

First service

When I put it to him that his firm's cost advantage was being eroded by new competitors while established brokers, such as Merrill Lynch, were also coming into the online market, he repeated again and again one word - service.

In this he is in good company. A survey by Datamonitor has found that 30% of UK retail stockbrokers rate customer service as their main advantage over competitors.

With cost advantages rapidly eroded by competition, it is inevitable that only firms with the best service will survive in the emerging world of online retailing.

"We want to provide our customers with great service" Schwab says, and for that reason he prefers people to use the website rather than the phone, saying: "That's where you get a great service".

Schwab has recently taken a pounding in the media for failing badly on quality of service because customers who had problems online were unable to get through on phone lines which quickly became swamped.

"Growing pains," says Schwab. "It takes at least six months to train new staff and we are growing so fast our standards can sometimes slip.

"For that we always apologise, and we are trying to increase our capacity."

Stamp duty

That will be welcome news to customers who have been left fuming by painfully slow responses from the Schwab website, and might reassure others who wonder whether they dare risk not being able to sell falling stock when they want to.

We finished off with a few words about the controversial 0.5% stamp duty on share transactions in the UK, and Schwab had a stark warning for the government.

"If the UK wants to continue to have a leadership role in global financial services, it must eliminate these frictions."

He said the government could make up the tax in other areas but that it had to understand it could not continue to place such costs in the market and not have that market go elsewhere.