Is online banking the right choice?

Friday, May 29th, 2009

Is online banking the right choice?

Is banking online a good choice for me?

Online banking is one choice for savings and checking accounts, as well as paying bills. For consumers who have regular access to computers and are comfortable using them for financial transactions, online banking can save time and even money.

Some online bank accounts are simply extensions of traditional bank accounts. The consumer sets up the account at a local branch office, then sets up an online version of the account. The consumer has access to all the regular services of the bank, including the bank’s ATM machines.

Other online bank accounts are with virtual banks – ING Direct is one that consumers often know. These are banks, just like any other, with the exceptions that they don’t have local branches; individuals cannot deposit or withdraw funds in person.

Also, since most virtual banks don’t have ATM machines, they may not accept deposits via ATMs. These types of banks can save consumers money, because the bank does not have to pay for things like rent for branch locations or salaries for tellers and bank managers to staff physical locations.

Convenience and online banking security are the two major considerations for most consumers when deciding to use online banking services, whether through a virtual bank or traditional bank. Access to a computer is a large part of both of those considerations.

Consumers who do not own a computer may find it inconvenient to have to leave home to find a computer on which to transact online banking. And, while online banking transactions are generally secure, there are some security risks to using a public or common computer for these types of secure transactions.

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