According to the Federal Deposit Insurance Corporation (FDIC), the Internet offers a safe and convenient way to shop for financial services as well as conduct banking business from the comforts of home. The challenge for many mature adults, however, lies in understanding that online banking allows bank clients to bypass time-consuming aspects of traditional banking and offers an efficient approach to money management.
Beginnings of Banking Online
While powerful computer and automated networks are not new to the banking industry, the growth of the Internet in the last decade has presented exciting new ways for banks to provide services to their clients at a whole new level. For years, financial institutions conducted millions of automated daily transactions. However, as more bank clients became connected to the Internet, banks realized the advantage of adapting similar internal electronic processes for personal home use. The move has provided economic advantages as banks have been able to eliminate costly paper handling and teller transactions while at the same time providing a “value added” tool to attract and retain clients.
Online banking, also referred to as Internet banking, electronic banking, home banking, and PC banking, has sometimes been met with hesitation or suspicion, leaving banks with the challenge of designing this service in a way that their clients will readily learn to use and trust it. Having spent generations earning the trust of their clientele base, banks are not about to risk that on a Web site that is confusing or less than secure.
In the last several years, great gains have been made in terms of security and protecting the identity of the user (bank client). Banks realized the necessity in designing sites which are easy to understand. This has helped mature adults become more comfortable with the use of online banking. Today, its use is becoming as commonplace as automated teller machines.
Online banking provides many advantages. For instance, the next banking transaction is always just a mouse click away. Online banking is available 24 hours a day, seven days a week. This is especially attractive for retired individuals who travel frequently or “snowbirds” who head to warmer climates during part of the year.
With a personal computer and Internet connection, the client has instant accessibility to their accounts, day or night. Transaction speeds of online bank sites are typically processed and confirmed at or quicker than ATM speeds. Perhaps most appealing of all, online banking features a level of unparalleled efficiency. Clients can not only access and manage their bank accounts they can also manage IRAs, CDs, and securities from one site.
But is it safe?
Every bank client wants to be assured that their personal information and transactions are secure. Begin by examining the bank’s site for information about its security practices, or speak directly to a bank associate.
Bank Web sites use encryption to protect their clients’ sensitive information. This process scrambles private information to prevent unauthorized access. A small icon usually at the bottom of the screen that resembles a “lock” or “key” demonstrates that the site and its information are secure. In addition, bank sites will require a personal identification number (PIN). When a client accesses their accounts online, they receive a password prompt. For the most secure password or PIN avoid using birthdates, number or words that can be easily guessed by others. Virus protection installed on a personal computer provides another necessary layer of protection. This, along with physical access controls, should be used and updated regularly. As an added security, when completing a transaction, clients should print a receipt and keep it with bank records until it is recorded on the client’s personal site and/or a bank statement.
It goes without saying, clients should always verify a bank’s insurance status, especially when conducting business with a new bank. Look for the familiar FDIC logo or the words “Member FDIC” or “FDIC Insured” on the Web site. It’s also important to know that some banks operating on the Internet are not insured by the FDIC, such as those chartered overseas. Any consumer who chooses to bank with this type of bank should be aware that the FDIC may not insure deposits.
Using new technology can sometimes be intimidating so it may be necessary to invest some time in a tutorial before becoming comfortable in a virtual lobby. While online banking is unlike the banking world mature adults grew up in, it represents the next wave of convenient and efficient banking – and that’s something from which anyone can benefit, no matter the age.
By Gulart from Pixabay