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Online banking, also known as internet banking, web banking, or home banking, is an electronic payment system that allows bank or other financial institution customers to conduct a variety of financial transactions via the financial institution’s website.

The online banking system will typically connect to or be a component of a bank’s core banking system in order to provide customers with banking services in addition to or instead of traditional branch banking.

Online banking reduces banks’ operating costs by reducing reliance on a branch network and provides greater convenience to some customers by reducing the need to visit a branch bank as well as the convenience of being able to conduct banking transactions even when branches are closed.

Internet banking offers personal and corporate banking services, including the ability to view account balances, obtain statements, review recent transactions, transfer money between accounts, and make payments.

Some banks operate as “direct banks,” meaning they only use the internet or the internet and the phone. They are distinct from “neobanks,” which lack depositary insurance.

Internet, customer apprehension, and Online banking

When the clicks-and-bricks craze hit in the late 1990s, many banks saw web-based banking as a strategic imperative.

In 1996, OP Financial Group, a cooperative bank, became the world’s second online bank and Europe’s first.

The appeal of online banking is fairly obvious: lower transaction costs, easier service integration, interactive marketing capabilities, and other advantages that increase customer lists and profit margins. Furthermore, Internet banking services enable institutions to bundle more services into single packages, attracting customers while reducing overhead.

Wells Fargo was the first bank in the United States to add account services to its website in 1995, and other banks quickly followed suit. That same year, Presidential became the first U.S. bank to offer Internet banking.

According to Internet Banking Report research

Less than 0.4% of US households used online banking at the end of 1999. At the start of 2004, approximately 33 million US households (31%) used some form of online banking. According to a Gartner Group survey, 47% of Americans used online banking five years later. Meanwhile, in the United Kingdom, between 2011 and 2012, online banking increased from 63% to 70% of internet users. By 2018, approximately 61 percent of Americans were using digital banking. In Europe, online banking penetration has also increased. In 2019, 93 percent of Norwegians use online banking sites, the highest in Europe, followed by Denmark and the Netherlands. According to a 2015 McKinsey and Company survey, more than 700 million Asian consumers use digital banking on a regular basis.

By the year 2000, e-banking was available at 80% of US banks. Customer usage increased gradually. For example, it took Bank of America ten years to acquire two million e-banking customers. However, after the Y2K scare passed, a significant cultural shift occurred.

Bank of America became the first bank to reach 3 million online banking customers

Accounting for more than 20% of its total customer base, in 2001. In comparison, larger national banks such as Citigroup claimed 2.2 million Internet relationships worldwide, while J.P. Morgan Chase estimated it had more than 750,000 online banking customers. Wells Fargo had 2.5 million customers who used online banking, including small businesses. Customers who shop online are more loyal and profitable than regular customers.

Bank of America customers made a record 3.1 million electronic bill payments totaling more than $1 billion in October 2001. The bank has 34 million active digital accounts, both Internet and mobile, as of 2017. According to a Gartner Group report from 2009, 47% of US adults and 30% of UK adults bank the Internet.

The rise of branch-less banks as internet-only institutions began in the early 2000s. These internet-based banks have lower overhead costs than their physical counterparts. Deposits at some direct banks in the United States are FDIC-insured and provide the same level of insurance protection as deposits at traditional banks. In the United States, neobanks are branchless banks that are not FDIC-insured.

First, there are online banking services

The United Kingdom (UK)

In the United Kingdom, online banking began with the launch of Nottingham Building Society’s (NBS) Homelink service in September 1982, initially on a limited basis before being expanded nationally in 1983.

Homelink was made possible through a collaboration between the Bank of Scotland and British Telecom’s Prestel service. The system made use of the Prestel viewlink system and a computer, such as the BBC Micro, or a keyboard (Tandata Td1400), which were linked to the telephone system and television set.

Users could use the system to “transfer money between accounts, pay bills and arrange loans… compare prices and order goods from a few major retailers, check local restaurant menus or real estate listings, plan vacations… bid in Homelink’s regular auctions and send e-mail to other Homelink users

To make bank transfers and bill payments, a written instruction detailing the intended recipient had to be sent to the NBS, who entered the information into the Homelink system. Gas, electricity, and telephone companies, as well as accounts with other banks, were typical recipients. The account holder used Prestel to enter payment information into the NBS system. NBS then sent a cheque to the payee, along with an advice detailing the payment to the account holder. Later, BACS was used to transfer the payment directly.

The United States of America

In the United States, in-home banking was “still in its infancy,” with banks “cautiously testing consumer interest” in 1984, a year after online banking became widespread in the United Kingdom.

Chemical Bank in New York was established at the time “It is still working out the kinks in its service, which has some limitations.

Chemical’s Pronto service, which was aimed at individuals and small businesses, was launched in 1983. It allowed them to keep electronic chequebooks, view account balances, and transfer money between checking and savings accounts. Soon after, the other three major banks — Citibank, Chase Bank, and Manufacturers Hanover — began to offer home banking services. Chemical’s Pronto was discontinued in 1989 after failing to attract enough customers to break even. Other banks had similar problems.

Since its inception in the United States, Internet banking has been governed by the federal Electronic Funds Transfer Act of 1978.


Following a test period with 2,500 users beginning in 1984, Internet banking services were launched in 1988, using Minitel terminals that the government distributed freely to the population. By 1990, 6.5 million Minitels had been installed in homes. One of the most popular services was online banking.

Later, online banking services migrated to the Internet.


Sumitomo Bank launched the first online banking service in January 1997. By 2010, the majority of major banks had implemented Internet banking services, though the types of services provided varied. According to a 2012 poll conducted by the Japanese Bankers Association (JBA), 65.2% of respondents used personal internet banking.


Tencent’s online bank, WeBank, launched a four-month trial of Internet banking in January 2015.


With the release of the C++ Internet banking programme in December 1995, Advance Bank, which had been acquired by St.George Bank, began to provide customers with Internet banking.

Recognizing Online Banking

Most basic banking transactions can now be completed online, eliminating the need for customers to visit a bank branch. They can do all of this whenever and wherever they want—at home, work, or on the go.

A computer or other device, an Internet connection, and a bank or debit card are required for Regions Online Banking. Clients must first sign up for their bank’s online banking service in order to use the service. They must create a password in order to register. After that, they can use the service for all of their banking needs.

Banking transactions available online vary by institution. Most banks provide basic services like transfers and bill payments. Customers can also open new accounts and apply for credit cards through Internet banking portals at some banks. Ordering checks, putting stop payments on checks, and reporting a change of address are examples of additional functions.

Checks can now be deposited electronically using a mobile app. To complete the deposit, the customer simply enters the amount before taking a photo of the front and back of the check.

Traveler’s checks, bank draughts, certain wire transfers, and the completion of certain credit applications, such as mortgages, are not available through online banking. These transactions must still be done in person with a bank representative.

Benefits of Online Banking

The convenience of Internet banking is a significant benefit. Region bank login online Paying bills and transferring funds between accounts are simple banking transactions that can be completed 24 hours a day, seven days a week, wherever the consumer desires.

Online banking is quick and easy. Funds can be transferred almost instantly between accounts, especially if the accounts are held at the same institution. Consumers can open and close a variety of accounts Internet, ranging from fixed deposits to recurring deposit accounts, which typically offer higher interest rates.

Customers can also closely monitor their accounts on a regular basis, allowing them to keep their accounts safe. Access to banking information around the clock allows for early detection of fraudulent activity, acting as a safeguard against financial damage or loss.

Online Banking Disadvantages

For a first-time Internet banking customer, using systems may present difficulties that prevent transactions from being processed, which is why some customers prefer face-to-face transactions with a teller.

If a customer requires access to large sums of cash, online banking is ineffective. While he may be able to withdraw a certain amount from an ATM (most cards have a limit), he will still need to visit a branch to obtain the remainder.

Although online banking security is constantly improving, such accounts remain vulnerable to hacking. To avoid unauthorised access, consumers should use their own data plans rather than public Wi-Fi networks when using online banking.

Furthermore, online banking is reliant on a stable Internet connection. From time to time, connectivity issues may make it difficult to determine whether or not banking transactions have been successfully processed.

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