What is Online Banking?

The days are past, when the only way to deal with a bank was by queuing up in front of the counters. Thanks to the internet, banks have reached out right into our homes, and online banking has become a way of life.

Internet banking takes normal banking one step further. It helps customers to access their accounts online. They can make transactions and make changes in their personal details in the account sitting right at home. Every major bank also offers information online, on the services provided by them.

Every major bank offers an internet banking service through which we can register. Charges for registration depend on the bank: there may or may not be charges for registering. Usually for personal internet banking the registration is free, but there may be a fee for business internet banking.

The security procedures would also vary from bank to bank. The security set up usually consists of a unique number or password issued by the bank and a 6-10 digit number which is to be set up yourself.

You can also transfer money online, from one account to another. If the other account is within the same bank, the amount will be transferred overnight. If the transfer is to an account in another bank, it may take over three working days.

Internet banking has its own advantages and disadvantages:

Internet Banking Advantages

The advantages of Internet banking are obvious. Business people can access their personal and business account information while saving a trip to the bank. You can check your balance whenever you need to, even if the bank is closed. The advantages of using internet banking are listed below.

1. Available for 24 hours a day, 7 days a week.
2. No need to stand in queues.
3. The account can be operated from anywhere – all you need is a computer with internet access.
4. Integrated security.
5. You can apply for a majority of the services such as loans, savings accounts, mortgages, etc., on-line.
6. It can be used for paying bills through on-line which saves both time and money on postage.
7. Through internet banking we can easily compare services offered by different banks. We can buy financial products and apply for loans by choosing the best bank for us to apply by such comparison.
8. We can even buy insurance online through Internet banking services.
9. Stocks and bonds and other investments can be managed with online banking from our home or office independent of a financial intermediary like a stockbroker.

Internet Banking Disadvanatages

1. The internet connection costs should be met by the customer while using the service.
2. The account cannot be accessed if there is a failure in the internet connection.
3. The bank and the account holder would not be having any personal interaction.
4. Working through the internet banking can be slow with a 56K modem.
5. You cannot deposit physical cash into your account, online. For that you need to visit the bank.
6. For obtaining cash floats or to use an ATM machine to withdraw cash we will have to visit the bank personally.