Though the simplicity and convenience of internet banking is difficult to dispute, there are reasons why some people are apprehensive about this popular technology. Believe it or not, online banking has been around for more than a decade now.
Of course, in the beginning, security was the primary concern as there were numerous glitches and widespread fear of identity theft.
However, as with all new technologies, the experts fixed the problems and secured the sites to the satisfaction of the banks that owned them. But still, the public did not bite. Looking back, this shouldn't have been surprising. After all, people had been doing their banking in person for hundreds of years, and the internet was still fairly new, which meant that only a certain segment of the population even had access to internet banking.
But as connections to the internet increased so too has the popularity of internet banking. According to a recent survey, more than half of the people online use internet banking. And while it is true that users have grown by five-fold, some people remain wary of doing their banking over the internet. These fears are akin to the apprehension that many folks have of purchasing goods with their card cards online.
Will people ever have complete faith in internet banking?
Recent surveys tell us that consumer confidence has increased as people have come realize that the many benefits of internet banking outweigh the risks. They have also come to understand that incidences of theft and fraud are often overblown and that most banks cover customers if someone gains unauthorized access to their online accounts due to inadequate security on the site.
So, what are the benefits of internet banking?
Just about every reputable site will let you view your account balances, transfer funds, pay your bills and even apply for a loan. Probably the most convenient basic feature is the ability to pay your bills for free. Payments can often be scheduled for delivery on the very next day.
This will not only help you save the time of writing a check but also save you the price of a stamp and a trip to the post office. Not to mention the money you can save on late fees, especially from credit card companies. An overnight electronic payment can save you a twenty or thirty dollars late fee if you neglected to mail your bill in on time.
Of course, internet banking users also save time and gasoline that would have otherwise been wasted traveling to the bank, waiting in line, and filling out forms. And since most online banking sites are updated instantly whenever your accounts are credited or debited, it is a cinch to check your current balances anytime of the day or night.
The constantly updated log of all deposits and withdraws will also help you track the charges and fees the bank has deducted from your account, which makes it easy to dispute them when you believe that they have made a mistake. And believe us, banks do make mistakes. The subprime mortgage crisis certainly taught us that!
These constant updates also mean that you will never have to worry about overdrawing your account, or at least you will never be caught off guard by it again. In the final analysis, managing your money online should and probably will end up saving you a good amount of time and money each year. This is especially true if you are a forgetful person or a procrastinator who often leaves his bill paying for the last minute.
As you might imagine, online banking is also beneficial to the banks. In fact, it is one of the single most cost-effective programs they can implement. Consider this: each paper transaction costs nearly three times as much as an electronic transaction.
This is due primarily to the wages of bank tellers and managers who spend all day dealing with something that could be completed far more quickly and efficiently online. That is the obvious reason why banks are offering these services for free. Really, did you think it was out of altruism?
Of course, like most things in life, there are also disadvantages. For one thing, internet banking does rely on passwords and codes, and if you misplace or lose this information it may take days to gain access to your online accounts. The delay is due to the fact that the bank will often have to reset your password for security purposes and then send it to you in the mail. Few banks will send you the information in the body of an email for fear that it will be intercepted.
There are also those that truly fear identity theft, which has been a growing problem on the internet for years now. Are these people simply paranoid, or are their legitimate concerns. Well, the answer might be somewhere in the middle. The fact is that while most online banking sites are encrypted and quite secure, it has happened in the past, even in the recent past. So, it is impossible to simply dismiss these fears as unfounded.
However, it is possible to obtain safety information and even guarantees of security in writing before you open your online account. The problem with this option is that there is often a waiting period before all of the paperwork is completed and the bank sends you it, along with your password and user codes, in the mail.
If you are considering online bill payments, it is important to note that they are not one- hundred percent effective. What we mean is that there have been cases where payments have simply disappeared or they have taken longer to arrive at their destination than they claimed.
This may, of course, result in accumulated penalties and late charges. And while most debits or credits are, in fact, instant, bill payments tend to take several days to post to you account, which may give you an inaccurate read on your balances.