Basics of Online Banking

Online banking provides a perfect opportunity for people to stay close to their finances and can be a big help for those who wish to take control over their financial affairs. Using online banking has become commonplace over the last decade but there will still be some people for whom it will be a new and perhaps slightly scary step into the unknown. Let’s look then at the basics of online banking from the perspective of someone who has not used it before.

Registering for online banking:
In order to be able to start using online banking, it is usually necessary to go through an initial registration process. You may be asked to complete an online application form, and the chances are that this will ask for confirmation of things like your name, address, and either sort code and account number or debit card details. As the final part of the registration process you will probably also be asked to create a password and/or passcode which you will then use every time that you want to log into online banking.

Security and login process:
A common fear that is expressed by those who are new to online banking is the risk of fraudsters accessing their money and stealing it. Banks guard against the risk of criminal activity by employing very strong encryption to protect their online banking pages. As part of this, users will require to enter certain login credentials, such as passwords and passcodes in order to access the site. It’s clearly important, therefore, that users create passwords that are not easy to guess. Provided you do that, and don’t ever disclose your login details to anyone else, then you should be okay. It’s worth reading up on online banking security guidance, however, to ensure that you know the ways to protect the security of your money.

Having created your login details, and been accepted for the service, you will then go to your bank’s website and click on the online banking login button. You will then be asked to enter the bank’s online banking login details. Often, it will ask for partial elements of your passwords and passcodes, such as 1st, 3rd, and 5th character from your password. Provided you have entered the login details correctly, you should gain entry to your secure online banking session.

Balance and statement details:
At first, you may be unsure about using online banking to make payments. That’s fine and you can start off by familiarising yourself with some of the service’s more basic components, such as the ability to view the balance on all your accounts and to view mini statement and full statement details. Being able to check these details as often as you like can be a great help for those who are working to a budget and want to see what they’re spending money on and how they are doing against their spending and savings targets.

Transfer money between your own accounts:
One of the biggest benefits of online banking is being able to quickly and easily transfer money between accounts that you hold with the same bank. For example, many people like to log in on pay day and transfer a sum of money from their checking/current account to their savings account. Or maybe they might, alternatively, see that they are in danger of going overdrawn and so may transfer money instantly from their savings account to their checking/current account.

Payments to other people, companies, or accounts you hold with other banks:
The other main bit of functionality that you can use online banking for is to make external payments. This might be a case of making a payment to a friend to cover a car share arrangement, or to your gas or electricity supplier. Or you might have a savings account with another bank and may wish to make a payment to that external account. The process of making a payment usually involves firstly entering the bank account details of the person or company that you wish to make the payment to. You will then be asked to enter the amount you want to pay and the account that you want to make the payment from.

Amending your personal details with the bank:
Anyone who has ever moved house will know how frustrating and time-consuming it can be to have to advise various companies of your new address. With online banking, however, it is often possible to update your details online, taking a lot of the hassle out of the process. There may be a range of other details that you can update such as phone number, mobile number, e-mail address, etc.

Switching to paperless statements:
Another big advantage of using online banking is it reduces the need to receive paper statements. Many online banking customers are happy to switch off their paper statements and to instead view their monthly statements online. This removes the need to shred those monthly paper statements (or will create much needed extra space in your study drawer!) and will also help you to do your bit for the environment.

Signing up for online banking and using it regularly will provide you with much greater control over your finances. It will also make undertaking your banking transactions so much more convenient. You will no longer need to travel to your nearest branch and stand in a queue to do a simple transaction, and you don’t have to worry about closing times. Inevitably, it will probably take a little while to get used to using online banking and to feel comfortable using its full range of functionality. However, for the most part, online banking is fairly intuitive and banks normally offer support through helpdesks and/or an online demo, so initial concerns will usually be overcome and you will probably find that you quickly become a big fan of being able to be your own banker.