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 Online
Banking can take different forms. Some online banking systems
are software based--meaning you will need software such as Quicken or Microsoft Money in order to access your account
(and you will only be able to handle your banking from your own computer). Other systems are Internet based--meaning
you can access your bank account from any computer that is connected to the Web--from your home, office or while
traveling.
Internet Based Banking.
Our focus here are those banks which are truly Internet based and 100% available online--in other words, those
banks without a "physical presence" of offices and branches. These banks also offer Internet-based banking,
which can be accessed by any Internet computer, without the need of special software. Since these online banks
have a lower business cost (they do not have to build, support and maintain expensive branches) their fees are
generally lower and their interest rates (on your deposits) are generally higher than "traditional" banks.
Why Online Banking?
Unfortunately, banking is a "necessary evil" that can take a large chunk out of already busy schedules.
Visiting a branch or ATM, paying bills by paper check (and mailing them) and balancing a checkbook all can be time
consuming. Banking online, by its nature, can automate many of these processes, saving you time and, in many cases,
money. You can access your account and do your banking when (and where) it is convenient for you.
Deciding to Bank Online.
If you have decided to do your banking online, we can give you lots of hints on getting the most out of the experience.
If you are not sure about banking online yet, we can point out some of the advantages--and let you know of some
potential disadvantages--so you can compare.
MM = Money
Market | CD =
Certificate of Deposit
Online Banking Advantages
- In general, you will find lower fees and higher interest rates for deposits
due to the reduced cost of operating online and not needing numerous physical bank branches.
- You will have easy access to account information and transactions, due
to the fact that any Internet-enabled computer can become your "bank terminal."
- You will generally have up-to-the-minute current bank account information
due the automation of most systems.
- You can transfer funds electronically between accounts.
Potential Online Banking Disadvantages
- You will need to mail (or have direct-deposited) any deposits to your
bank account.
- Online banks generally do not have their own ATMs, although you will
be able to access ATMs provided by many other banks. Most online banks offer a rebate for ATM usage.
- Most online banks do not have any physical locations for you to visit
if you prefer to transact your business in person and face-to-face.
Online Banking Hints
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Make Comparisons. All
online banks are not created equally. There can be variances in fees, interest rates and special offers that may
be available. |
| ATMs. If you need frequent
access to ATMs, check the bank policies. Depending on the account, some online banks will rebate you for some of
your ATM usage. |
| Telephone Support.
If you need telephone support, when is it available and is there free unlimited phone access? |
| Get Automated. Online
banking is most efficient with automation of as many processes as possible. For example, have paychecks direct
deposited (no trips to the bank) and take advantage of online bill pay (no need to write checks for bills and then
pay to mail them). |
| Access. Does the bank
require you to download additional software (not a true Internet based bank) or can you access your account anywhere
with simply an Internet connection? |
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