So, you're still walking into your local bank to conduct your financial business. Understandable. There's a level of comfort in standing eye to eye with the person counting your money. You enjoy trading stories with your favorite teller. And above all, you've got this nagging fear that some tech-savvy smarty-pants may steal your financial information if you join the population of online banking customers.
Take a little comfort in this: Online banking is more advanced and secure than ever, experts say. And if banking research is accurate, a growing number of boomers and seniors are bypassing the brick-and-mortar branch to manage their money from the couch.
Banking online has added perks for older Americans, who may desire a larger slice of independence from caregivers. No need for physical challenges to keep you from paying a bill, either. In the end, it can be an easier way to bank and, in fact, keep you closer to your money.
Not quite convinced online banking is for you? We rounded up a group of experts to answer your most common questions:
• Paul Gentile, executive vice president, Credit Union National Association
• Greg Hughes, vice president, information security officer, digital channels, for Fiserv, an information technology provider to banking institutions
• Heather Almand, communications manager, Digital Insight, which offers innovative online and mobile banking solutions to consumers and financial institutions
• Ken Nagel, chief information officer, Farmers & Merchants Bank
• Susan Fitzpatrick, director of communications, Ally Financial
Why should I do my banking online?
Almand: You get flexibility and convenience. Online banking allows you to view your account balances, pay your bills, locate ATMs, transfer funds and even deposit checks all while on the go, 24/7. If you can't get to a branch during service hours, online banking gives you alternative ways to handle your banking needs.
What kind of equipment do I need?
Almand: Ideally, a computer, laptop or tablet with updated security software. If depositing checks from home interests you, a scanner could come in handy. In some cases, you can use your smartphone for depositing checks, too. We will discuss the latter in detail further down.
Will I be able to do everything online that I do at my local bank?
Almand: Pretty much. If your financial institution also provides personal financial management tools, you'll be able to manage all your banking, credit and financial accounts in one place at your favorite bank or credit union.
Nagel: Some banks, like F&M, even offer something called text banking, which provides you access to accounts via text (SMS) messages on a mobile phone. It's a fast and easy way to look up account balances or view recent account history.
How long might it take to register my account online?
Gentile: That depends on your financial institution. In many cases, it's as simple as filling out a short form online. You'll need some information at your fingertips, including your account number (or, as referred to at many credit unions, your member number) and some other identifying information, so the institution can tell it's really you signing up for your account. It's a process that, in many cases, takes only minutes.
Will it cost me more in fees to handle my banking online?
Fitzpatrick: Many virtual banks, like Ally, don't charge monthly maintenance fees. Since we don't have expensive branches, we save money on operating costs compared with traditional banks.
Almand: Most brick-and-mortar banks and credit unions also prefer you use the online and mobile banking tools they provide because it allows them to meet your needs without having to keep a branch open 24/7. Often, the services are free.
(If you choose a virtual bank, which doesn't have its own branches or ATMs, find out if you will be charged a fee to withdraw money from the ATMs of other institutions. Some do, some don't and will reimburse you for ATM fees other banks charge you. Visit the bank's website or contact a bank representative to learn more about its fees for services.)
How would I make my check deposits?
Gentile: ATMs are still quite popular for making deposits, although some experts predict they have seen their best days, particularly with the popularity of remote deposit capture — a service many institutions have adopted. With a scanner or fax and a computer, members scan their check for deposit and send it electronically from anywhere. Customers can also use the camera on their mobile phone to take a picture of a check and send it electronically to the bank or credit union for deposit, using an app on their phone. (Check with your bank to see if this service is available to you.)
Almand: With mobile remote deposit capture, customers can also safeguard information with the same security as online banking while allowing them to retain the original copy of their check.
What can you tell me about banking with my smartphone?
Gentile: Again, convenience rules — you can conduct your financial business wherever you are, rather than at your desk or kitchen table at home. As mentioned earlier, many institutions offer free mobile phone apps you can download that allow you to check your balances, deposit checks, transfer money and pay bills.
How safe is my financial information with online banking?
Hughes: Financial institutions are held to a high standard when it comes to protecting your money and personal identity information. Federal and state regulations require banks and credit unions to use multiple layers of protective security in their online banking systems, and the regulators who assess these institutions check to make sure your bank is meeting their stringent security requirements. Your bank has a vested interest in making sure its online banking systems, whether PC- or mobile-based, are safe and secure. Delivering financial services through electronic channels is a cost-effective and competitive way for your bank to do business, so it will place strong emphasis on securing those systems and making them safe.
However, you as an individual also play a role in making sure that your financial information is safe. While more and more banks are starting to deploy security technologies that try to assess if anything is wrong with your device before allowing you to log in to online banking, it's still very important to be sure that the computer or mobile device (wireless phone or tablet) that you use for online banking is secure.
I use Wi-Fi with my personal laptop. Could someone tap into my account at home or outside, say, at a coffee shop?
Hughes: Generally speaking, online banking Web sites are protected using end-to-end strong encryption technology, which ensures that even if you are using an unsecured wireless access point, the information and data being transferred between your laptop and the bank is completely encrypted and therefore not viewable by a malicious person in between. But it's important to understand that there are potential risks associated with using unknown and nonsecured wireless (Wi-Fi) access points. Using and maintaining firewall and antivirus software on your computer is important when using public Wi-Fi hotspots, and you should avoid using any Wi-Fi hotspot you are not familiar with for banking.
Which is more secure: banking by computer or by mobile phone?
Hughes: Both of these channels are safe and secure if you take the appropriate basic precautions on your computer or mobile phone. In the world of computers, the operating system software that makes them work has been improved and made more secure over time. As long as you follow the general rules of online computer safety they provide a safe online banking environment. Mobile devices have the advantage of running relatively new operating system software, which has been developed in large part with strong security in mind from the very beginning. Both types of online banking access can be safely and reliably used.
What are a few things I can do to keep my information safe?
Hughes: Encryption, patching, antivirus and firewalls help keep a bad person from snooping or hacking your system and stealing information, but there are much lower-tech methods that criminals use to try to get access to online banking accounts. We call these methods social engineering, and they are made up of various ways that the criminal tries to make you believe they are someone legitimate in order to convince you to provide them with your private and personal information.
1. Whether via email, in a Web browser, phone call or even in person at your front door, question any and all requests or solicitations for sensitive information. Your bank will never ask you to give it your online banking password on the phone, for example, and you should never provide personal information in response to an email. Be suspicious whenever you are asked for things such as account numbers, PINs, Social Security numbers, passwords and the like — no matter how legitimate the email looks or the caller sounds. The best rule to follow is this: If someone else initiated contact with you, don't share sensitive data. Hang up or delete the email — you can always call your bank back at a number you know to be legitimate in order to ask if it was a legitimate request. If you get an email or text message that contains a link and you're not sure where it came from or if it's legitimate, don't click! Just delete the message.
2. Always have a firewall and antivirus/antimalware software running on your computer. This is a simple and fundamental step to prevent much of the bad software and people that are out there from affecting your computer system.
3. Apply operating system and software patches to your computer and mobile device when they are available. Many people have difficulty understanding how to do this on their mobile phones, but often the device manufacturer or mobile phone vendor where you bought the phone or tablet can do a very good job of showing you how.
4. When you are accessing an online banking website, make sure the connection is encrypted. An indicator of a secure website is an address (also called a URL) that begins with "https" in the address bar; the "s" stands for "secure." The "https" prefix should be seen on every page of websites that are used to conduct transactions, in addition to the sign-in page.
What are some, if any, drawbacks to banking online?
Gentile: The biggest drawback may be your own level of personal comfort with obtaining and using financial services in this manner, and perhaps the face-to-face customer service, if that is important to you. (As a workaround, some banks allow you to "chat" or instant message a representative online to answer your questions and concerns.)
Otherwise, you can't beat the convenience.
Stacy Julien is a writer and editor with AARP Media.
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