Advantages and Disadvantages of Online Banking

by Shakti Singh Dulawat on June 22, 2010

Online banking can simply be defined as the process of entering into transactions by a particular client and the bank using modern technology.  With the various capabilities of the computer and other technological developments, online banking is one of the many businesses that benefited from it.  Since banking plays a very important role in the economy of a nation, then there is truly a need to maximize and improve its features to be client friendly and easy to access.  There are of course the advantages and disadvantages of online banking.

Among the advantages of online banking include the following:-

  • Very convenient.  Online banking is a totally easy thing to do.  In the comfort of your home or offices, you can do whatever monetary transactions you wish to do with your bank.
  • Unlimited service day and night.The services and various features of your bank are always available seven days a week and 24 hours daily.The most interesting thing here is that, everything can happen at just one click of your mouse.
  • No time constraint. Online banking is also stress free because it never closes unlike the traditional banking that has cut-off time.
  • Easy to access via PC. Using your personal computer, you can easily do various transactions with your bank in view of your business or any other personal or financial matters.
  • Easy way of payment. Bill payments can also be handled properly and smartly.  Instead of waiting for certain due dates, you can easily pay all your transactions using your computer and in coordination with your bank.
  • Smart.  Online banking is also ubiquitous or simply put smart.  This enables you to do troubleshooting regarding any problem that may arise from your business.
  • Higher interest rate. Another great advantage of online banking is the interest rates which basically range between 5% to 3.40% annually.   Unlike the traditional banking, online banking can earn you a better interest or return of investment both in your savings and checking account.
  • Easy transaction.Another advantage is the speed of every transaction.  Online transactions, compared to ATM or traditional banking, works faster.  Thus business matters could benefit so much from this speed feature.
  • Banking online is both efficient and effective.  With just one secure site, all your financial transactions can be managed orderly.

On the other hand, the following are the disadvantages of online banking:-

  • First is the slow processing from the moment you entered a financial transaction with your bank via the computer.  Usually the bank will require you to submit certain documents like an identification card, signature and the like.  Not only will the bank online require you to submit documents but also to provide special power of attorney in cases where you want to do transactions together with your spouse.  A concrete example is when you want to manage all your wealth and resources together as a couple and you wish to view it online.  Certain technical procedures regarding online banking may be taxing too and complicated.
  • Another disadvantage is the so-called learning curve.  This means, banking online especially in locating the sites may be complicated and hard to find.
  • Another disadvantage is bank site changes.  If this occurs, the bank will require you to re-enter all your information again and other related data.
  • Finally is the trust aspect.  Online banking should be entered very carefully if you wish to enjoy your financial life.

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As a conclusion, banking online has its benefits and discomforts and it will be up to the client to choose which for him or her is more convenient, hassle-free and efficient.

{ 10 comments… read them below or add one }

Bernadette Gillespie September 21, 2012 at 1:56 pm

I am an ICT A level student and I would like to ask permission to use some of the information about the advantages and disadvantages of online banking in my work. It will be used for educational purposes only and your website will be referenced. Thanks.


$hakti $ingh Dul@wat September 21, 2012 at 7:45 pm

Thanks that you found this website useful for yourself, if you are using content of our website than please add a link related to article so user can know the original article details!



Senthilkumar October 7, 2012 at 4:21 pm

Thanks for the information about e-banking


$hakti $ingh Dul@wat October 7, 2012 at 9:19 pm

You are much welcome keep reading!



LAIZER November 11, 2012 at 6:30 pm



Pompy ciepła Poznań December 17, 2012 at 11:04 pm

It’s difficult to find well-informed people on this subject, but you seem like you know what you’re talking
about! Thanks


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Eduardo February 7, 2013 at 9:34 am

It is important to be careful when banking online. You do not want your safety or privacy to be breached. It is important to clear your cookies after each banking session, if you are at a public computer.


the eden biodome product review May 25, 2013 at 3:24 pm

Thanks for the good writeup. It in fact was once a leisure account it.
Look complicated to far introduced agreeable from you! However,
how could we be in contact?


$SURESH$ PBR August 29, 2013 at 4:50 pm

thanks for giving e banking information


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