The pros and cons of online banking

Oith the proliferation of internet banking, it’s hard – even for those old enough – to remember a time when offline banking was all there was.

Send and receive paper checks, go to the bank to deposit or withdraw, work around bank hours to check or confirm your balance, and so on. But we didn’t care. That’s how it was.

But now internet banking has become so mainstream that the thought of having to go back to the offline days is frightening, as we have no idea how we got by without the internet.

Online banking is (mostly) positive

Few would argue that online banking isn’t a beneficial tool that fits right in with the fast-paced world we live in. The comfort is undeniable. But while the pros of online banking certainly outweigh the cons, there are a few cons. Let’s look at both the pros and cons of online banking.

Benefits

pay bills – Whether paying through your checking or savings account, a money market account, or even from your home equity line of credit, the ability to pay most or all of your bills online is something we simply cannot live without. Most creditors even allow automated recurring payments so consumers don’t risk forgetting to pay a bill and being penalized.

Movable capacity – Most banks not only offer their customers the convenience of online banking, but they also offer mobile-friendly websites that allow customers to do their banking on the go. Applications offered by banks are constantly being implemented with more and more features in an effort to extend the convenience offered to smartphone users.

Simple setup and use – Online banking is for the most part as easy as using any other interactive website. With just a few clicks and keystrokes, even the most inexperienced Internet user can be up and running with their online banking account in no time. Most banks even offer 24-hour live customer service or email customer service capability.

The inconvenients

Granted, there aren’t too many downsides to online banking, but there are some things that many customers would change if they could.

Security – This is arguably the biggest downside of online banking. The new millennium is the age of the hacker and identity theft is one of the most prevalent social diseases in America and around the world. So, despite every bank’s best efforts to secure their website, unfortunately nothing is foolproof and there is always at least a slight risk that someone somewhere will hack into your account and gain access to sensitive information.

Transaction issues – Even though online banking is light years more convenient than its traditional counterparts, only certain aspects of banking need to be done in person rather than behind a computer or mobile phone screen. Depositing cash, completing certain types of international transactions, and other service issues can be difficult to resolve over email or even real-time chat with customer service. With some service issues, the onus is on the customer to travel to the bank and meet their needs face-to-face.

Here is the budget – For users who find it difficult to make impulse purchases or avoid the need to formulate a budget, instant access to an account balance can breed irresponsibility. It’s easy to fall into the “I still have money in my account” trap, but it hurts long-term and short-term financial planning when users think a positive balance means there’s still money left in my account. money to spend, when in reality that doesn’t mean any deductions are reflected in the account.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.