Nowadays, people prefer managing their finances in the comfort of their homes. Instead of going outside to a physical bank, which consumes time, online banking has certain advantages that traditional banks don’t have. Online banking has adopted most of the functions that traditional banks offer plus you can check out your transaction anytime, anywhere.

Find out more about online banking below.

Mobile Banking vs. Online Banking

Banks offer mobile banking as an extension of their service. Features of mobile banking differ from bank to bank but the most common feature is you can track all of your account transactions. Most mobile banking also allows check deposits and instant bill payments.

On the other hand, online banking or net banking is what you called for using the bank’s website for managing your account. It can also apply to banking that is only done online, where you use the internet to conduct all of your banking transactions and make purchases.

Advantages and Disadvantages of Online Banking

Compared to traditional banks, you may expect relatively low fees with online banks as they’re not operating a large number of physical locations. As an example, the financial service company, Chime, makes sure that their clients are assured so they are granted a maximum $200 overdraft support of no fee, whatsoever.

Savings accounts and a few interest-bearing checking accounts are often offered at better APY rates by online banks, which some offer 1% to 2% higher than traditional banks. It may be a small number, but don’t belittle it. For your reference, you could make $1 over the course of the year if you have $10,000 in your account from a conventional bank. In contrast, about $50 could be earned if you put your money in an online bank account which generates around 4.05%. See the difference?

Technology is a huge gift to all of us. And with it, managing our finances has been made easier. You might think that online banking is only accessible with the help of the Internet, but you thought wrong! Actually, the majority of online banks are linked to ATM networks, allowing you to almost instantly withdraw money from your account. Over 55,000 Allpoint ATMs that are located right in establishments like Target, Walgreens, CVS, and more offer free ATM withdrawals for Varo accounts.

Even if the majority of conventional banks provide mobile apps and online bill payment, online banks continue to rule the financial technology industry. More online features and improved online customer service are to be expected. You can even get in touch with bank officials all week and even at midnight.

The common types of accounts that online banks offer are savings, checking, and the money market. But for customers to manage their multiple accounts all at once, some banks provide a variety of banking options. Credit cards, checking, savings, and auto loans are all available in Capital One.

Perhaps the most disappointing thing about online banking is the liquidation of your money. You can only withdraw less than $700 from ATMs so if you need more money than that, then you’re in a terrible spot. To prevent this to happen, open an account with an online bank that also has physical branches. You may consider Chase as there are tons of Chase branches all over the States, and most probably near one at your house!

Should I Trust Online Banks with my Finances?

Like conventional banks, online banks have a $250,000 FDIC insurance limit, so you can be assured of not going broke if your online bank went bankrupt. The scary thing, however, is if a hacker gains access to your account, any bank or credit card with online access could be used for illegal transactions.

To avoid getting your account hacked, always think before you click. Emails from scammers that appear to have come from your bank are renowned for making you instantly click on links. Make sure that you verify the email address that was used to send the message and not only the displayed name. After that, close the email, open a new tab, and log into your online bank account.

You may also start by constructing a strong and secure password and make sure to not share this with anyone. Some banks have also introduced two-factor authentication to add more security, so make sure to enable it (although it takes more time to sign in). Additionally, don’t log in to your account on another device or while connected to public Wi-Fi. It is also best that you access your account on your own phone, even when you’re outside.

What Services to Expect from Online Banks?

Online banks provide a wide range of services to assist you in maintaining good money management and achieving your financial objectives. Check out some features you may anticipate from any online bank:

• Pay bills: Pay your bills all at once or set up an automatic payment to avoid incurring late fees.

• Send money through wire transfer: Send out money to any bank account of your choic anytime, anywhere.

• Deposit checks online: Use your phone to scan the code to deposit a check.

• Transfer funds from one bank to another: Transferring money from one bank account to another is simple if you have multiple banking accounts.

• Accessible digital bank statements: You may get your account statements in an instant with no problems.

• Banking with a smartphone: Managing your finances while on the move is simple with mobile banking.

• Borrow money: Take out a loan to pay for your expenses such as student loans, auto loans, and home loans.

• Identity theft protection: Secures your finances and personal information.

If you haven’t tried online banking, then you’re missing out. Get on with the trend and have your financials managed even while you’re sitting on your couch, at work, or even while strolling around the park. Online banking is a fair choice even if you just want a savings account to keep your money for your future. Even then, you’ll get the benefit of getting a high APY or maybe several money market accounts to earn more.