Online Banking

Online banking enables you to use a Web browser to access your accounts, balance your checkbook, transfer funds, and even pay bills online. In fact, nearly 7 percent of Americans used online banking services by end of 2002. The use of online banking expected to grow 14 percent per year by end of 2007. By that time, some 30 percent of Americans (67 million individuals) will be using online banking services. Currently, banks that offer online banking gain a competitive advantage over those that do not, because most customers now consider it a necessary and expected service, like ATM’s. Online banking helps banks cut down on the expenses for maintaining bank branches and paying tellers and allows them to provide advanced levels of electronic customer service. Banks implement online banking in different ways. One method makes use of personal finance programs such as Microsoft Money or Intuit’s Quicken, enabling customers to balance their checkbooks automatically. An advantage of this to customers is that Microsoft Money and Quicken offer powerful features for budgeting and analyzing spending habits. The drawback of this method, however, is that you can only access your online bank accounts from the computer that holds all the Money or Quicken data. Easier online banking tools are Web-based systems that require only one program: a Web browser. All the data are stored on the bank’s computer, not your own, which means that you can access your account from any computer connected to the Internet. Although Web-based online banking doesn’t offer the advanced budgeting and analysis features that Money and Quicken do it’s much easier to use because you are directly manipulating your accounts online instead of recording copies of your work in offline programs.