Online Banking

1
Online Banking

• Take Charge of your Finances

2
Online Banking

• In the year 2006, 63 million Americans reported
  that they used online banking
• 43 of internet users in the United States bank
  online

3
Online Banking

• Online banking also known as internet banking,
  allows consumers to complete transactions with
  wireless technology. Wireless technology
  includes
• Personal Computers (PCs)
• Personal Digital Assistants (PDAs)
• Cellular phones

4
Online Banking

• Consumers can access account information and
  statements

5
Online Banking

• Consumers can transfer funds

6
Online Banking

• Consumers can manage bills and apply for credit

7
Online Banking

• Advantages

• Disadvantages

• Decreased cost of paper and postage
• Storing all statements online instead of keeping
  a paper copy
• Convenience
• Paying bills online
• Ability to access account anytime
• No waiting for a monthly statement

• Not as personal
• Not able to access without technology
• Decrease in safety features
• Increase in risk for fraud

8
Online Bill Payment

• Online bill payment allows consumers to send
  money from one account to a vendor
• Usually occurs automatically
• Consumers need to check with the vendors
  regarding their policy of when the payment will
  be processed

9
Online Bill Payment

• Examples of companies that use online bill
  payment include
• Retailer banks
• Credit card companies
• Insurance companies
• Energy and utility companies
• Health care
• Transportation companies
• Education expenses

10
Online Bill Payment
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Online Bill Payment

• Important financial aspects include
• Checking with the vendor or company to understand
  their policy of when transactions are complete
• Confirming there are enough funds in the account
  to cover the expense of the bill
• Confirming bill will be paid, money will be taken
  out of the account, and the transaction will be
  completed
• Their financial information is secure and it is
  safe to make online transactions

12
Determine Security

• The Uniform Resource Locator (URL) ends in s
  which stands for secure
• A closed lock to the right of the URL or in the
  bottom right hand corner of the web browser to
  indicate a secure site

13
Insecure Practices

• Email accounts are not secure
• Do not send important information such as
• Social security numbers
• Bank account numbers
• PIN numbers

14
Consumer Protection

• The Federal Reserve Bank of Chicago suggests the
  following
• Passwords are a combination of letters and
  numbers
• Avoid using passwords that would be easy for
  someone to guess such as birth dates, phone
  numbers, names, sequential numbers, etc.
• Change passwords once a month
• Keep all receipts and compare them to bank
  statements monthly
• Log out of depository institution Web sites
  immediately after you finish working
• Contact the depository institution directly with
  any questions or concerns

15
Recurring Payment

• Recurring payment bills are set to be paid on
  the due date or a previous date set by the
  consumer
• Payment will happen automatically electronically
• Advantages of recurring payment include
• Save money on postage
• Saves time for the consumer
• Bills are paid on time

16
Regulation E

• Regulation E covers all electronic fund
  transfers including transfers occurring through
  an electronic terminal, computer, telephone, or
  magnetic tape
• The transfer must be conducted with the purpose
  of authorizing a depository institution to debit
  or credit a consumer's account

17
Consumer Protection

• Privacy Policy outlines how a consumers
  information will be used and protected
• Opting out of a financial policy allows a
  consumer to request a depository institution to
  share only a limited amount of personal
  information

18
Conclusion

• Review
• Define online banking
• Review what transactions can be completed through
  online banking
• Discuss advantages and disadvantages of online
  banking
• Discuss online bill payment
• What are secure and insecure online banking
  practices?
• Any questions?