Advantages and Disadvantages of Online Banking

By: Dachary Carey

The advantages and disadvantages of online banking is convincing and many people now use a hybrid of Internet Banking at a physical and a bank account with a local bank. While online banking does not seem as tangible as the removal and storage of cold hard cash, you can do almost anything with the online banking has its branch.

Save time and money

Probably one of the biggest advantages of online banking to save time and money. When using online banking, you can check your account, schedule bill payments and manage deposits with a few mouse clicks. Even better, you can manage your money 24 / 7, not 9-to-5 schedule a physical bank somewhere in different parts of the city.

No more phone calls or trips to the ATM to check your balance, nothing Fussing around with paper invoices, losing one and having to go search for it and miss a payment and not worry cousin Sally bought a birthday check or wait for your paper statement arrives in the mail to find out.

Online Bill Payment

Most Internet banks allow you to set up online bill pay. Using pay the bill online, you can either choose to make an initial payment of your bills, or you can set up bill payments recurring monthly bills such as car loans, car insurance or your mortgage . This advantage of online banking is invaluable because you can make payments at any time and know exactly when the payment is credited.

No more putting a bill in the mail and receive notification next month that the check was late, or that the recipient gets about a transformation before their due date. Pay your bills online also saves you the fear of losing a bill, manage their bills electronically, and you never have to worry about the missing piece of paper.

Interest-bearing accounts

It is well known that online savings accounts generally earn a better return than savings accounts in a brick and mortar bank, but you might not understand that some banks also offer checking accounts paid. NetBank rates on checking accounts ranging from 0.5% to 3.40% per year. These rates rival the interest rate you would get a savings account at a traditional bank, and you have little chance of finding an interest bearing account at a bank check usually is.

Funny Money

While online banking makes it easier for you to manage your money, it can make it easier to forget to check how much you have, so you can budget. Online banking is a bit like using a credit card, easy access makes it easy to use without thinking why you are using. You can create e-mail to let you know how when your account dips below a certain number, but nothing beats seeing me, and keep your checkbook balanced.

Also, when you get a credit card in the mail and opens it on a monthly basis, you are immediately reminded to verify the charges on your bill stranger. It's easier to forget to keep track of this information online, and you will have good money management habits.

Security

Hackers can break into almost any computer system, so how can you be sure they will not break into the system at your bank? You can not, but all the sites online banking that you think should have opinions on the type of security they use. You must also send an email to the bank or the head of the bank branch to find out exactly what would happen if there was a breach of security, and push the point or go to another bank if the answer is unclear. Generally, you should think about your money as safe online as it would in a vault, but it is your responsibility to know how the bank is safe if it is FDIC insured, and if they keep their systems Security update. Finally, you should also make sure that you use security software on your personal computer to reduce the chances that anyone can retrieve your personal data.

You may miss the physical location

While Internet banking has many advantages, one of the biggest drawbacks is the lack of a physical location. Being able to make deposits in a bank account physical guaranteed peace of mind, and you do not have to ask you if your check is lost in the mail, or when it will be credited to your account.

You can also physical location for other reasons. The finances are quite complicated, and it is no exaggeration to think that you may have a question about a transaction fee or a day. One of the disadvantages of banking online is that you can not speak with a customer service representative in person, you must send an e-mail or call a number and wait your call to be answered. If it is a sensitive issue or if it is an error in your statement, you might get a quicker response if you go to a bank branch.

Internet banking makes sense: The hybrid approach

Although more and more companies have gone online, giving you the opportunity to verify the statements and pay online, in some cases, even today, simply call the business on paper. Some companies have set up online banking, so you need paper checks to those companies. If you rent an apartment, the landlord will probably not equipped to receive electronic payments, so you should check to pay the rent. Although it is convenient to be able to use electronic bill pay, you're going to need to use the check card at some point.

Deposits are another disadvantage of online banking. If you use a bank that does not have a physical location, you must send your payment to your bank. In these cases, you can wait a week or two of your payment being received and processed, and that's when you can not access the money. Sometimes things are lost in the mail, so security for payment by mail is questionable. Many people who use banks that exist only online to keep a second bank account at a bank in physical proximity to deposits, then transmit them electronically to their bank on the Internet.

Even if you are inclined to rely solely on online banking, the disadvantages of online banking is strong enough to make it wise to keep a second bank account in a bank premises. Find a bank offering online banking offers physical best of both worlds, giving you a place to deposit quickly and easily, but the freedom to access your money at any time.