Online Banking

Online Banking

Most high street branch banks such as NatWest and HSBC offer online banking for their account holders. These are called Brick and Click banks. I will talk about the advantages and disadvantages of using online banking.

egg

A normal bank would usually have an online site and a shop in store, how ever there are banks that operate entirely online such as egg, which started back in 1998 and has grown since. They have a large number of customers but a very low number of employees simply because they just operate online, according to Wikipedia they have approximately 1100 employees. This is a very big advantage that egg has over typical banks, having low numbers of employees reduces the cash output.

Advantages for the customer

• You can get your latest online statement, because yet again online banking is open all day round, anytime of the year unlike high street banks, this makes online banking very convenient for a busy person working 9-5.
• With online banking you can make instant transfers to anywhere in the world within a couple of clicks, unlike high street banks it usually would take 3-5 working days for the funds to be transferred.
• Most banks have developers working behind the scenes to develop banking applications for popular platforms such as iOS and android, this is a great advantage because it means you do not even have to be on a computer to make a transfer.
• There is usually no paper! You receive all statements to your email address. This saves paper which is an added bonus.
• If your bank details get intercepted banks usually offer a compensation scheme. The banks are that confident nothing will happen to your information.
• All your details are stored securely and you do not have to store them in your household.

Disadvantages for the customer

• Banks tend to have a very complex security procedure, although people will always try and access your information. This can be very time consuming.
• No in person contact with bank staff, if you do it all online you have no human interaction.
• The process to log in can be very lengthy, either to the customers Internet connection or due to all the security questions the customer has to answer.
•  When entering in your information it is very easy to press a wrong button, and if you do press a wrong one you usually have to start right from the beginning again.
• Not everyone has a computer, and not every one knows how to use one, the world is just adapting to the digital side of it now.

Advantages for the bank

• Banks such as egg operate just online, this saves paying for a shop floor/premises, this saves them a lot of money, and they can then invest that money into security for their site.
• Adapting their system to use online banking will attract a lot of new customers as in this day and age a lot of people are now on the move and do not have time to go to a bank, they would prefer to do it online.
• An online bank doesn’t have to employ as many employees as a usual brick and click one.
• Advertising is much more easier and you have a wider audience to entice them to sign up.

Disadvantages for the bank

• They invest a lot of money into their security system. This can be very expensive, but also pays off after a while.
• Some of the customers enjoy going into the bank and having a face-to-face interaction, online banks will loose a lot of customers to this.

Advantages for the employees

• New jobs will be created and this will help improve the current economic climate.
• Working in IT will give you a range of new skills.

Disadvantages for the employees

• Some employees will have to be retrained to use the system.
• Eventually they may no longer be required to work there, as sooner or later everything will become fully automated.

 I personally have had no experience with online banking, however members of my family have and although they think it’s a great service and will use it when they have to, they would rather prefer to go into the bank its self and do it there as they find its less riskier.