Advantages and Disadvantages of Internet Banking
What is the main advantage of internet banking? It gives you control. Paying bills, transferring money, applying for credit cards, moving savings into a higher interest account – all these day-to-day banking activities are so much easier with online banking. There is no need to queue during your lunch break, no need to rush to reach the bank before it closes, no worries about dealing with an urgent transaction late in the evening – this can all be done from the comfort of your home using your computer and normal internet connection.
Internet Banking – Advantages
Internet banking offers very real benefits in the ability to track and manage your finances online, at your own convenience, from the comfort of your home (or office). Also, by making it easier to shift money between different accounts, you can make your cash work for you by ensuring it is always in the highest interest paying account. And, the internet makes it easier to find the best deals on savings, credit cards, loans, whenever you want.
Perhaps the biggest advantage to internet banking is that it is much cheaper for the provider to run an online service than a traditional bricks and mortar banking service. These savings in cost are more likely to be passed on to the customer, who will enjoy lower rates on overdrafts, and more interest on any surplus cash in the current account.
Also, it is relatively straightforward to switch accounts if the rates become less competitive. It’s usually very simple to open an account online. You simply log on, answer some questions, choose a password, and print off the form for signing. A real signature is a legal requirement, so you will need to sign and send in the form, along with any documentation required.
Internet Banking – Disadvantages
You may see the odd report in a newspaper about mistakes and technical hitches causing problems with internet banking. Well, these things can occur with traditional banking as well – the bank’s computer can be ‘down’ when you need to make a withdrawal, the person you urgently need to see may have just left for lunch…
Some internet banks are offering very advantageous interest rates which they most likely will not be able to sustain in the long term. Well, by all means enjoy these rates while they are available – just be aware of the fact that they might eventually drop and keep an eye out for it. Remember – it is relatively quite easy to switch banks online.
Whether you switch to internet banking now, or wait until more of the ‘teething’ problems are sorted out before making the move, the arguments for changing to online banking are becoming more compelling. If your bank’s server computer goes offline, you might occasionally find yourself without access to your money for a few hours, but this can just as easily happen with ‘traditional’ banking as well.