Online Banking Explained
While in the beginning days of online banking people were often somewhat hesitant to trust these services too much, these days people are well aware of the security protocols that are in place to protect your account in an online environment.
The pros of engaging in online banking usually largely outweigh the cons, making it a must for countless people across the world. This page will explore all of the key aspects of online banking, giving you a bit of an insight into the matter.
Is it easy to open a bank account online?
The process of getting started with online banking is supremely easy. If you already have a bank account, then there is a good chance that the given financial institution you are using has some form of online banking available. This can make it easier for people to initially get up and running.
However, even if you are starting from scratch and opening up an account with a provider for the first time, the process is relatively simple. The entire process can usually be completed online. This means that you do not have to line up in a physical bank branch. These days, many institutions are now only accepting applications for new accounts online.
You will be asked for a lot of the same types of information when applying online as you would need to provide for a traditional bank account. This includes your personal details like full name, address, date of birth, and social security number.
What are the different types of online banking accounts?
When it comes to online banking accounts, they will normally not differ much from traditional bank accounts. The only difference is that you are able to manage time over the internet rather than through a physical branch. Here are some of the common and best online banking account options you will come across:
A checking account is the most basic type of account that you will come across. This is the main way in which people will receive funds from their jobs, where they will pay bills out of, and they will keep their funds that are needed for their day to day expenditure. These checking accounts will come along with a debit card. These cards can be used through the chip and pin technology, as well as contactless technology nowadays in a lot of cases. You are quickly able to manage this card via online banking. For example, if you have lost your card, you can quickly cancel it and have a new one sent out If you are going to be traveling to different countries and you want to make sure that the bank does not block the card, you can leave a travel note on your account. With your checking account, you can set up automatic payments for the likes of bills. You can also easily keep track of all of your expenses, easily filtering between different types of payments. There will often be some different fees attached to a checking account. There can be monthly or quarterly maintenance fees charged by even the best online banks in 2020. There may be discounts on these fees for the likes of students. You may have certain charges for debit card payments and ATM withdrawals, Finally, if your account goes into the red, you will likely face overdraft fees.
A savings account is another type of popular online account that you will come across. This is where you will send your money if you are trying to create a sum of savings for funds that you will not need quick access to. In the past, these accounts would earn you some decent levels of interest, but in most cases, this is no longer the case due to the ultra-low interest rates. One of the main perks of these accounts is that you will usually have no periodic maintenance fees to deal with, as well as a superior interest rate to that of your checking account. You can easily search for the best online bank rates around today. The given bank may impose some rules on savings accounts, such as always maintaining a minimum balance and a cap on how many transactions in and out you can make every month.
You are able to get a credit card in a lot of cases when you have a checking account. The credit limit on this card will depend on your history with the given bank, as well as a number of other factors, such as your credit history. A lot of the best online bank account options will have a separate account with your online banking that will showcase all of the activity on your credit card. Usually, you will set up a direct debit from your checking account that will pay off this credit card monthly repayment. The advantage of having a credit card is that it is often a safer way to conduct transactions when compared to the likes of a credit card. Naturally, the drawback is if you borrow money that you don’t have and can’t pay it back. This will damage your credit score and significant interest on the debt will usually build up.
Pros & Cons of switching to an online banking account?
Naturally, there are many advantages associated with online banking. First and foremost, you will be saving yourself time as you will not have to make as many visits to a physical bank. You will also be able to instantly check what your current account balance may be, without having to wait for your monthly paper statements.
You can quickly and easily transfer money between your accounts or send payments or transfers to other parties. Everything can be done on the go from your computer or mobile device, giving you great flexibility. Sometimes, the fees for online banking will be even lower than those seen with traditional banking.
Finally, you have all-around more control over your finances and the ability to review your situation and improve how you spend and save money. This goes for the best online bank account options from the best online banks in 2020.
In terms of the cons of switching to online banking, there are not too many of them. Some people will still prefer to deal with a real-life person when conducting different forms of banking. Certain people might not be as tech-savvy and might have concerns about the security of online banking.
Choosing the right type of online banking
There are plenty of different choices among the best online banks in 2020. You may want to stick with the same bank that you currently use, while others prefer to look at greener pastures. First and foremost, you need to make sure that the providers you are considering have a good reputation in terms of reliability and security.
The last thing you want to do is trust your funds to a dodgy provider or one that does not have proper security protocols in place. Thankfully, online banks that are regulated in the US are similar to traditional banks in that they have FDIC insurance of up to $250,000. However, you should still be careful about revealing any sensitive information about your online banking or clicking on any links you receive by email or SMS.
Perhaps the optimal way to find the best online bank account is to read the expert reviews on LendStart. These take an in-depth look at all aspects of these offerings. You can then see which option is the best fit for your specific situation and proceed from there.
Online banking is here to stay. It improves the efficiency of a wide variety of banking functions immeasurably. No matter if you are at home or abroad, you have access to your bank accounts at the click of a few buttons.
You have a lot more control over your financial situation and you can always be aware of the funds coming in and out of your accounts. To find the best online bank account from the best online banks in 2020, you can check out the expert reviews on LendStart.