Online Banking

Online Banking

The first online banking system (RBS 1983) only provided online banking services to commercial companies and not to their customers. In today’s age, however, many of the major high streets banks, NatWest, Nationwide, HSBC etc. offer online banking services to their customers.

Egg

Egg is an exclusively online banking service. It was founded in 1998 and has been growing in popularity since. Egg have a large number of customers, competing in numbers with the main high street banks, but have very few employees purely due to the fact they operate exclusively online, according to the latest statistics egg only employee 1100 people. This is an advantage of working exclusively online, because the less employees you have the lower your cash output will be.

Advantages for the customer

One advantage for the customer is getting an online statement quickly; because online banking is open 24/7 you can receive it any time of day.

It is convenient for people who work 9-5 days.

You can make instant transfers from anywhere in the world, this is better than high street banks, as bank transfers can take 3 – 5 days.

Online banking can be accessed from handheld devices such as iPhones and Android Phones; this is great for people today.

There is no paper!

Disadvantages for the customer

Banks have very complex security systems, and entering security details can be time consuming.

With online banking there is no personal contact, some people have trouble trusting others without human contact.

As I previously mentioned banks have very complex security systems, but these still can be accessed and therefore you money can be accessed.

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 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,

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 have no personal experience with online banking, however, members of my family have tried it before and they have said that they find branch banks easier to trust. I can however see there are a number of positives to online banking.