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Banking on the Internet Made Easy

At the beginning of the Internet revolution in the early 1990s, gurus made the prediction that our every day lives would be made simpler in ways we never dreamed possible. Nowhere is that more true than with Internet banking. According to the Pew Internet and American Life Project, nearly 50% of consumers now use Internet banking in some form. Internet banking is the fastest growing area of Internet use.

Setting Up Internet Banking

Internet banking services are available in some form from nearly all retail banks. Even smaller banks and credit unions have fairly robust Internet banking offerings. Also available are several "virtual" Internet banks - those that do not maintain brick-and-mortar branches but instead conduct all transactions online.

Internet banking services are usually free to existing customers who already have an account that is used on a fairly regular basis. Anyone who has been paying a monthly fee for online access should check with his bank about having the fee waived.

Consumers who are new to the Internet or worried about security can start slowly by setting up online access with their current bank. The easiest way to set up Internet banking is to go to the bank's website and look for a button that says "Register for online access". The web site will then do a walk through of the steps to set up security passwords and questions and activate Internet banking for the account.

Internet Banking Security

Hackers and scam artists are always looking for access to financial information, and online access is just one more portal to that information which needs to be guarded. Banks try to maintain security by setting up security questions in addition to password access, and use complicated encryption sequences to keep information from being intercepted.

Consumers using Internet banking should guard their passwords carefully, should not use an easy-to-guess password. Steps must be taken to guard against spy ware and other malicious programs which may try to download to your computer to steal your passwords as well.

Anyone considering setting up an account with a virtual bank online should check that the bank is registered and in good standing with the Federal Deposit Insurance Company (FDIC). If a virtual Internet bank should fail, all deposits up to $200,000 will be insured by the federal government. This step also helps to weed out scams from legitimate Internet banking enterprises.

Internet Banking Activities

Internet banking has proven to have enormous benefits in time management and ease of access almost to the point of addiction. You can open accounts, CDs, manage investment accounts and retirement accounts, move money, and pay bills, at any hour of the day, from the comfort of your home or during a spare moment at the office. Once a user name and password are set up, a variety of actions can be performed online:

  • Set up checking accounts, savings accounts, CDs, and other types of accounts
  • Check balances and reconciling accounts in real time
  • Set up recurring payments
  • Send payments directly to vendors
  • Link all accounts from the same bank
  • Receive overdraft alerts and other balance management tools

Few of the great expectations for the Internet has come to fruition to the degree of Internet banking. The fast growth of banking on the web attests that a need for convenience and direct banking access is finally being met. As more features are added to the arsenals of banking websites, it will become an ever more valuable tool in our daily lives.