Why Prefer an Online Bank Account?
Nov 20th, 2014 Banking
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Bank accounts that are mainly maintained and operated online are known as online bank accounts. These accounts are provided by online banks, which are not the same as street side banks. Bank accounts can now be opened and maintained online, without having to go to a branch. Online bank accounts have similar features as the bank accounts functioning from streets.
However the main difference is the accessibility of the accounts. Street side banks offer customers with branches and bank staff to help them maintain their accounts. While online banks provide most of the services online, they don’t have branches and customers don’t meet the bank staff personally.
Features and services provided by online banks
Tech savvy customers who use internet frequently can now make the most of online banks, as they make banking easier and simpler for customers. With online banks customers can save a lot of time, without having to visit the branch. Banking chores can now be completed by customers from any location provided they have access to internet. Below we have listed few of the features provided by online banks.
- Easy Account Opening: Customers can open online bank accounts online via website, for this they have to log on the bank’s website and apply by filling the online application form.
- Purchase Certificate of Deposits (CD’s): Customers can buy CD’s online through the bank website.
- Online Bank Customer Service: If customers have any enquires they can connect with customer service via online chat, email and toll free telephone banking services.
- Fund accounts: Customers can open different type of fund accounts online.
- Transfers: If customers have two or more accounts with the online bank, they can transfer money easily between their accounts through online banking. This service can also be used for transferring funds to other bank accounts.
- Balance, Recent Transactions and Statements: Customers can view and take print outs of statements, recent transactions and balance through online banking• Direct Deposits and Standing Orders: Online bank accounts provide these options to make customer’s life easier, and best thing is – this can be done online in fraction of minutes.
- Debit Cards: Customers who have checking accounts will be provided with a debit card, so that they can withdraw funds at ATM’s.
- Online Bill Payments: By logging on the accounts customers will be able to make payments between different states and countries; this can be done by filling the required information online.
- Check: After customers open the accounts online, checks are mailed to them via post.
- Loans: Through online bank’s, customers can apply for a loan by getting a quotation through their website.
- Overdraft facility: Online banks are offering customers with overdraft facility; customers can use this overdraft facility by applying for it. Many people now opt for overdraft facility as this saves them during the rain day. Also interest to be paid on the overdrafts is usually low.
We can see that the features and services provided by online banking makes customers’ life easier, it also saves them from standing and waiting in long lines at the branch. Some people prefer online bank accounts as its less time consuming and simple to use.
Benefits of online bank accounts
Online bank accounts have many similar features and services that are similar to institutional bank accounts. With so much in common certainly customers would like to know why to opt for online banking, bearing this in mind we have listed some points below.
- Hassle free banking without branch issues: As online banking doesn’t have branches customers don’t have to face the trouble of waiting at the branch. Generally customers have to stand in a line to submit forms for getting loans and opening accounts. However customers don’t face the same issue with online banks as it’s much easier. All that the customer has to do online is fill the details and click to submit. So we see that people can easily save time and get their banking needs fulfilled from any location with internet access.
- Interest Rate: Online banks do not have high expenditure like the financial banking institutions. Buildings, staff, branches and other infrastructure expenditure is not applicable for online banks. As online banks don’t have high expenditure, they are more likely to give higher interest on savings and lower interest for loans. However this can vary from bank to bank and some financial banking institutions might offer more too.
- Free Checking Accounts: Customers, who wish to get an online banking account, can simply start by applying online with a minimum balance of $1. Some online banks offer free checking accounts too. Customer doesn’t require huge deposits to open a checking account. It’s very rare to find free checking accounts at financial banking institutions.
- Updated with technology: Financial banking institutions provide their customers with internet banking, due to which many customers get to manage some accounts online. However, when compared to online banks, we can see that online banks are more advanced with technology than street side banks. Online banks are totally dedicated to serving customers online, hence they always try to find new innovative methods to serve their customers. For example: Online banks came up with the concept of mobile check deposits, this service made customers download a mobile application through which check deposit can be made by clicking a picture of the check. The instructions to be followed would be provided by the bank and the mobile screen. Following which the customers of few online bank accounts could get their checks deposited without going physically anywhere. This way online bank comes up with many innovative tech savvy services to keep their customers happy.
- Independent maintenance: Online bank account removes the hassle of middlemen. The customer doesn’t have to worry about any errors or wrong entries. As they will be the sole managing party on the account. When customers take care of their own accounts they are more cautious and careful while making payments and other transactions. As online bank accounts give customers complete access to their accounts online, there is more scope for managing the accounts productively. For example: Customer M has checking account and savings account. Ms M receives $1000 from her aunty; this amount credited her account as of today. In this scenario Ms M doesn’t have much expenditure for the next 1 year, and decides to save. She can immediately log on the account online and transfer the funds. By doing this she will earn interest from the day of receiving the funds, and she can also check how much interest she is earning by logging on to the account every month.
- Saves Paper: Customers don’t have to order statements every month, as they can check the information online. This will surely reduce the requirement for paper and saves the environment in one way.
Hence from the above mentioned information we can clearly see that online banks can make customers life more comfortable, by helping them operate their accounts online. Online bank accounts are easy, safe and less time consuming. If customers are well advanced with technology and internet they can surely opt for online bank accounts, as it not only saves their time, but also helps them earn decent interest on savings.
Customers who opt for online bank accounts should be cautious about online banking security; it’s advisable to ignore phishing emails while following the other security methods to maintain the security of their account.
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