 ONLINE
BANKING - INTERNET BANKING
Online banking (Internet
banking) is a term used for performing transactions, payments etc.
over the Internet through a bank or credit union.
This allows customers to do their
banking outside of bank hours and from anywhere where Internet
access is available.
In most cases a web browser such as Internet Explorer or Mozilla Firefox
is utilized and any normal Internet connection is suitable. No special
software or hardware is usually needed.
There is a
growing number of banks that
operate exclusively online.
Because these online banks have
low costs compared to traditional banks they can offer high interest
rates. |
Online Banking
Security
- Confirm that an online bank is legitimate and that your
deposits are insured
- Keep your personal information private and secure
- Understand your rights as a consumer
- Learn where to go for more assistance from banking regulators
|
Online banking usually
offers such features as:
- bank statements, with the
possibility to import data in a personal finance program such as
Quicken or Microsoft Money
- electronic bill payment
- funds transfer between a customer's
own checking and savings accounts, or to another customer's account
investment purchase or sale
- loan applications and transactions,
such as repayments
- account aggregation to allow the
customers to monitor all of their accounts in one place whether they
are with their main bank or with other institutions.
Some customers avoid online banking
as they perceive it as being too vulnerable to fraud. The security
measures employed by most banks are never 100% safe, but in practice the
number of fraud victims due to online banking is very small.
Indeed, conventional banking practices
may be more prone to abuse by fraudsters than online banking. Credit
card fraud, signature forgery and identity theft are far more widespread
"offline" crimes than malicious hacking. Bank transactions are generally
traceable and criminal penalties for bank fraud are high.
Online banking can be more
insecure if users are careless, gullible or computer illiterate. An
increasingly popular criminal practice to gain access to a user's
finances is phishing, whereby the user is in some way persuaded to hand
over their password(s) to a fraudster.
|
|
Also remember that not all banks
operating on the Internet are insured by the FDIC. Many banks that are
not FDIC-insured are chartered overseas. If you choose to use a bank
chartered overseas, it is important for you to know that the FDIC may
not insure your deposits. Check with your bank or the FDIC if you are
not certain.
For insurance purposes, be aware that a bank may use different names for
its online and traditional services; this does not mean you are dealing
with separate banks.
|