Online Banking

Online Banking:

Online banking is a feature of the internet that has taken a fair while to come into fashion. The idea of online banking first arrived in the 1980’s being first used by the Royal Bank of Scotland in 1983. The fact that online banking is open 24/7 there is no wonder as to why it is becoming such a growing fashion. With banks becoming ever more busy and complex there needed to be something added to the system that helped motivate and move clients swiftly along whilst attending to those inside the actual bank. Thus online banking was born. There are a number of services that is common within online banking, some include:

-Transactional (undergoing financial transactions such as an account to account transaction, making new accounts, paying bills, applying for a loan etc.)

-Transfers to a customer’s own transactional account and savings account.

-Investments.

-Bank statements, mostly in a PDF format.

-Financial queries and support.

-Viewing previously paid cheques.

-Managing multiple users on one account, with varying degrees of authority within that account.

Egg:

With the internet being so vast and always expanding, and always gaining users, it’s no wonder that banks have moved on to the internet; some of which are only found online, not in the high street. One example of an online only bank is a business known as Egg. Egg is a British internet bank that was made in 1998 by a company called Prudential Banking. It is the world’s largest internet bank in the sense that you can only access your account over the internet. Egg mainly specialises in savings, credit cards, and insurance (but does not offer loans or mortgages). On 29^th January, 2007, Prudential had announced that it was going to sell Egg to Citigroup, an American multinational financial service, for an estimated £575 million pounds, and as of May 1^st, 2007, the sale of Egg was completed and under new management of Citi. Egg was such a big success in England that it launched in France in 2002 to gain more potential customers. Sadly the service never gained popularity with the French, who are in fact known to generally hold few credit cards than the British; so as of 2004 Egg decided to close its French connection and concentrate solely on England.

Security:

Banks on the high street today, as everyone knows, are extremely security orientated and focused, undergoing procedures on a regular basis to ensure their customers and themselves that the money is safe within the bank. The same expectations go for online banking, and even to a degree more. It is much easier to simply hack into something on the internet than to break into something on the high street, especially with the tools of covering you identity along the way and injecting viruses into systems. Endless security questions and information are needed to set up and log into your account online; which is a main factor as to why people do not use it. Though this is all for good intentions as there are so many cases of fraud in today’s society that there has to be all these precautions to make sure you are who you say you are. It is very common nowadays to duplicate the look of websites to gain the information when customers login to a fake bank. A similar issue is to send out an e-mail to the customer as if they were in fact the bank, requesting personal information for some fake statement.

Advantages of Online Banking:

-Using the online bank means that you do not need to travel there.

-Banks are known to have very unhelpful opening and closing times, and not open at all on Sundays, but online banking is open 24/7.

-You can get online statements to give you full details of your banking.

-Every so often the banks need to send out mail regarding information on how much money you have in your account. But with the online site, they can send you the information via the site or an email you have provided for them which is much quicker than mailing out the information; and in turn it also saves the business money on postage and paper.

-You can access your bank from the comfort and safety of your own home.

-Queuing is not a problem which is sometimes a major annoyance with banks on the high street.

-Not as many employees are needed to run an online bank when compared to a normal bank. (This also relates to paying the employees also).

-Jobs for computer mechanics and designers can be opened up with online banks.

Disadvantages of Online Banking:

-Online banks are always number one at risk of being overrun with virus’s and hackers trying to steal bank credentials.

-Transactions may take a long time to process with all the security checks you might need to pass.

-Banking online can sometimes be a very complicated system to get into.

-There is no professional advice or one to one advice for people with questions, which is something that banks are quite usually used for.

-Some employees from actual banks may lose their jobs.

-Usually on the internet if something goes wrong with a brand or business, within hours the news is global purely down to the communication the internet holds. So if a problem arises within the online bank its reputation is almost surely going to plummet.

-Getting customers to trust your site may become a long process due to hackers and viruses that can affect your account.

-If an online bank is closed for maintenance then it will affect everyone everywhere regardless, but if one bank on the high street, with many more sites located all around the country, is closed for maintenance at least then the others are still up and running for everyone else to use in that area; so it does not completely stop the banks progress for a whole day.