A recent survey by the American Bankers Association (ABA) found 25 percent of bank customers prefer to do their banking online compared with any other method. The annual survey of 1,000 consumers was conducted by the independent market research firm Ipsos-Reid over a two-day period in August 2009. The results were published online by the ABA in September 2009. The ABA says the survey results show that bank customers prefer the expediency of online banking over physically visiting a branch bank and is indicative of a growing trust in the security and accuracy of this new technology.
Accessibility
Online banking was first made available in 1995, according to MSmoney.com. Now that nearly 70 percent of households in the U.S. are connected to the Internet, online banking is becoming more commonplace. All that's required to get started is computer and Internet access and a bank account with a financial institution that offers online services.
Internet bank customers are able to conduct all of their day-to-day banking business--such as checking account balances, transferring funds among accounts and setting up regular electronic (online) bill payments--via their computer.
Online Bill Pay
Setting up online bill paying requires that you input the names and addresses of your payees along with your account numbers. Once your bill pay account is set up, your information will appear automatically each month. When your bill arrives, you simply enter the amount to be paid, and the date the payment should be sent to the payee. Online bill pay also offers the option of setting up automatic monthly payments to be paid out to the same creditors.
Direct Deposit
Direct deposit simply means your paycheck or other payments can be electronically deposited into your checking or savings account. This eliminates the need for a paper check that you must physically bring to your bank for deposit. You can authorize the deposit of funds directly into your bank account by giving your employer or other earnings source a voided blank check or deposit slip from your account.
Additional Features
Online banking customers may also view current and past monthly statements and processed checks, issue stop-payment requests, order checks (regular, cashier's and traveler's) and even apply for loans.
Fees
Most banks and financial institutions offer free online bank services because Internet transactions generally save banks money. If a fee is charged, it is usually between $5 and $10 per month.
Precautions
The FDIC says the Internet offers the potential for safe and convenient new ways to conduct banking business 24 hours a day. When shopping for online banking services, the FDIC advises potential customers to read the "About Us" section provided by most bank websites. This is where you may learn about the history of the bank, along with its official name and physical address.
The FDIC provides a detailed brochure to help potential online bank customers make good choices and avoid banking scams: www.fdic.gov/BANK/INDIVIDUAL/ONLINE/SAFE.html
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