Internet banking is the act of conducting financial intermediation on the internet. It includes offering of information and selected services through the World Wide Web by banks and other financial service firm. For those who are quite new to the concept of online banking, this type of service offered by banks actually works the same way as traditional banking. The major difference lies in the convenience offered by online banking particularly when it comes to making payments, obtaining updated information of the account, or merging account statements. Rather than personally visiting the local bank, customer can now access their account and perform bank transactions using the computer. At the comfort and privacy of their own home, they can now be able to complete various bank transactions with just a click of the mouse.
II. Services offered by internet banking
Technology has considerably changed every aspect of people’s lives – how to communicate, how to research, even everyday tasks such as banking. Traditional banking and all it includes is slowly becoming a thing of the past. Bill payment, account alerts, and money transfers are a few services that are now offered through online banking. The services available online vary from bank to bank. Most of the general services are on all banking websites but the larger banks contain more control over the money.
Bill payment is a service that allows paying the bills online whenever customer wants and to whatever account they have. People can pay almost anyone from friends to businesses and creditors. Through this feature can schedule payments in advance, set up recurring payments on regular bills, and even view payment history. Most importantly, service is free. There is no need to waste any time or money waiting in line at the post office to get stamps, making extra trips to the mailbox and ordering checks.
Account alerts/reminders, can set the account up to send alerts and reminders to email address or cell phone. Payment reminders, receipt alerts of the daily balance, and monitoring debit card for suspicious activity are a few options with the account alert service. Money transfer, online banking has made this feature convenient and east. With this feature, people can transfer money between accounts. This is not just limited to the account within one particular banking institution but almost any banking institution that people have an account with.
III. Advantages and disadvantages of Online Banking
Online banking definitely has several advantages that make individuals and organizations use this kind of transactions and service. The internet is a low-cost source of information and service delivery for a bank, providing availability at any time anywhere so they can serve customers around the glove. The cost of establishing and maintaining a website is relatively low when compared to building, equipping, and staffing a traditional office. Another advantage is that online services are available twenty-four hours a day for the whole year and usually offer consistently accurate transactions. It is very convenient. Online banking is a totally easy thing to do. The interest rates which basically range between 5% to 3.40% annually. Unlike the traditional banking, online banking can earn you a better interest or return of investment both in your savings and checking. Another advantage is the speed of every transaction. Online transactions, compared to Automated Teller Machines (ATM) or traditional banking works faster. Thus business matters could benefit so much from this speed feature. It is both efficient and effective. With just one secure site, all the financial transactions can be managed orderly. On the other hand, the following are the disadvantages of online banking: First is the slow processing from the moment entered a financial transaction with bank via computer. Usually the bank will require submitting certain documents...