When a virtual or retail bank, building society, credit union or other financial institution lets its clients carry out transactions on a secure website that it controls, this is known as ‘online banking.’ A client must have personal Internet access and he or she must register with the financial institution in order to enter its online banking service, and set up a password for customer authentication.
Having up-to-date information at your fingertips can help you make better financial decisions when it comes to managing your bank accounts. With online banking you get access to your bank account at any time in the day or night to transfer funds and track balances any time you like. You also get alerts to help you check account activity and avoid fees, and you can view account statements and cleared cheques online.
With online banking you can make use of other services such as bill payments, account transfers and credit card payments. Online bill payments allow you to stay on top of your utilities by having the bank pay them directly. Account transfers can be done for domestic and in most cases international banks. Finally, most online banking applications will allow you to make payments to your credit card.
If you forget your password, it’s usually easy to create a new one online. Most banks will not send your password by email for security reasons. If you forget your username, there’s usually a way to retrieve it using your Social Security or a similar number. Most banks allow you to apply to open an account online. Similarly, requests to close accounts that do not have a balance can in most cases be processed online.
In many cases you can use a bank’s online banking service to send money directly within your country to anyone who has a mobile phone or email address. There are usually no charges to send the money, and the receiver also does not have to pay a charge. It’s easy to do, and you get a receipt while the receiver gets an email with instructions on how to claim his or her funds.
Of course, there are some caveats to using online banking. For example, this type of service is impersonal, and there’s no way you can develop a relationship like you can with say a teller or a loan officer. Another pitfall is that you might have to wait a long time for cheques to clear. You also need to be aware that sometimes banking websites experience technical difficulties, and when this happens you will be unable to access your account.
Online banking gives you the opportunity to go past the paper-based, time-consuming aspects of conventional banking so you can take care of your finances more efficiently and quickly. It is a powerful tool that adds value to a customer’s account, and it also helps the bank to save money on paper and teller interactions. In time, complete suites of online banking services are expected to become as commonplace as automated banking machines.