Test your understanding of internet banking to determine whether you’ve fallen for any of these common misconceptions.
How recently have you been to a bank branch? Modern digital technology virtually eliminates the need to enter a physical bank: According to the American Bankers Association, over three-quarters of Americans conduct their banking largely online or using a mobile device.
The thought of having a checking account with a bank with a local branch might still appeal to you, though. Why? Perhaps you believe that online banks are less convenient than going to your local branch to get cash (free coffee excluded), that the benefits are inferior to those offered by traditional banks, or that online banks are not insured. These are actually three of many widespread misconceptions regarding online banking.
According to Monica Lam, creator of the money-saving site Lucky Mojito, “People who believe online bank accounts are cumbersome may not know how they function.” “Without having to drive to the bank and stand in line, I can mobile deposit a check into my account at any time.”
Lam wishes she had been more aware of the advantages of online checking accounts earlier and avoided falling for popular online banking fallacies. If someone had informed me I could save money on gas and time by not having to drive to the bank to deposit my checks, I would have made the transition a long time ago, says Lam.
What online banking fallacies are most common, you might be asking yourself at this time. We dispel them so that you can see why opening an online checking account can be the best choice for you.
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Myth 1: They’re inconvenient e is a fiction.
FinanceMarvel’s certified financial planner Patricia Russell concurs. Many bank functions
Don’t just believe Lam when she says that online banking hassles are accessible 24/7 using some online accounts. Using the website or mobile app, you can conveniently open an account, check your balance, deposit checks, apply for loans, and pay bills,” Russell explains.
If convenience is important to you, you might also be concerned about being able to get cash without visiting a physical bank branch, but Russell points out that online banks may have a sizable network of ATMs that you can use. For instance, you can use your debit card at more than 60,000 no-fee ATMs when you have Discover’s Cashback Debit online checking account. How’s that for dispelling internet checking myths?
Myth 2: The benefits are inferior to those offered by commercial banks.
If you think this, you’ve bought into one of the most widespread misconceptions regarding online banking.
According to Suro, one reason you might be able to gain from some online banks is that they frequently have little overhead, which allows them to pass along incentives to customers.
The fact that many online banks have low or no costs is one such incentive that dispels this misconception regarding online checking.
For ordinary banking tasks like opening an account, ordering checks, using an ATM, and making the majority of money transactions, you might not have to pay any fees, according to Suro.
Myth 3: Using online accounts requires advanced technical skills.
One of the most common misconceptions about online banking is that you need to be a tech expert even while you need a computer, tablet, or smartphone to use access an online checking account and a bank online.
Having an internet account does not need extensive technological knowledge, according to Russell. Even for individuals who claim not to be tech-savvy, certain banks typically have a basic and uncomplicated design, according to the author.”They appreciate the importance of easy-to-use websites and mobile apps.”
Myth 4: If there’s a problem, you won’t be able to speak to a human.
Another misconception about online banking is that since you can’t physically visit a branch to speak to a representative, you won’t have access to good customer service for your online checking account. Wait a minute.
You can call customer service agents at several online banks, and some of them may even offer this service around-the-clock (no need to even leave the comfort of your home if you have a question). For instance, Discover offers round-the-clock customer service.
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Myth 5: Online banking is not insured.
The last internet banking myth is that the money you put in is not insured.
According to Lam, online banks that are FDIC members can insure your funds up to $250,000 or the maximum amount permitted by law. Check to see if the online bank is FDIC-insured before opening an account. Calling the FDIC’s toll-free number at 1-877-ASK FDIC (1-877-275-3342) and asking a deposit insurance specialist to confirm that the potential online bank is FDIC-insured is one way to do this.
