Vol.

2 Special Issue 13 April 2018 E-ISSN: 2456-5571

PROS AND CONS OF ONLINE BANKING SERVICES

Dr.G.Nedumaran
Associate Professor, Department of Commerce, Alagappa University, Karaikudi

M.Baladevi
Ph.D. Research Scholar, Department of Commerce, Alagappa University, Karaikudi

Abstract
The Online banking Services are increasing day by day in the Banking sector in India. In this paper aims to
examine the Online banking Services of the Banking Sectors in India. In this study used to collected data from
primary and secondary sources which are collected from Banking Customers, Website and other sources. The Online
Banking Services is briefly explained Pros and Cons, Features and Drawbacks Virtual Banking . It means The
researcher concludes that through effective regulation, creating awareness of the Online banking Customers.
Keywords: Online Banking Services, Features, Pros and Cons

Introduction accessed to, say, cheque, savings, loan, credit

Online banking, also known as internet card and similar accounts.
banking, e-banking or virtual banking, is Online banking allows a user to execute
an electronic payment system that enable financial transactions via the internet. Online
customers of a bank or other financial banking is also known as "internet banking" or
institution to conduct a range of financial "web banking." An online bank offers customers
transactions through the financial institution's just about every service traditionally obtainable
website. The online banking system will typically through a local branch, including deposits,
connect to or be part of the core banking system which is done online or through the mail, and
operate by a bank and is in distinction to branch online bill payment.
banking which was the conservative way
customers accessed banking services. Objectives
To access a financial institution's online 1. To study the Benefits of Online Banking
banking facility, a customer with internet access 2. To identify the Features available through
will need to register with the institution for the Online Banking
service, and set up a password and 3. To study the Drawbacks Virtual Banking
other credentials for customer verification. The
credentials for online banking is normally not the Benefits of Online Banking
same as for telephone or mobile banking. 1. Convenience: By banking online, you can
Financial institutions now routinely apportion carry out your banking activities whenever you
customers numbers, whether or not consumers want. Online banking is a 24 hour service, so you
have indicated an intention to admittance their are no longer tied to the branch’s hours. On top of
online banking reserve Customer numbers are that, you don’t have to take the time toward travel
normally not the same as account numbers, to the branch and wait in the expected lines, thus
because a number of customer accounts can be giving you more time to do what you want.
linked to the one customer number. Technically, 2. Mobility: Online banking can be done from
the customer number can be linked to any account anywhere, as long as you have an Internet
with the financial institute that the customer connection. Even if you are away for business or a
controls, though the financial institution may limit vacation, you can still take care of your banking
the range of accounts that may “Emerging Trends desires. Some banks, such as Bank of America,
un Customs Clearances and Logistics” be alive have even created mobile applications that make

106 Bodhi International Journal of Research in Humanities, Arts and Science

 Vol.2 Special Issue 13 April 2018 E-ISSN: 2456-5571

banking easier for those with a Smartphone like 8. Real Time Account Information: Because
the Apple iPhone or iTouch or a Blackberry. you can access your accounts anytime, you can
With this added mobility, you’ll no longer have to get up to date, real time in sequence on the
worry about missing a payment or any other money in your accounts. This will allow you to
time reactive banking activity. better administer your money and gain the most
3. No Fees: Because an online bank doesn’t from different accounts, interest rates and
have to worry about funding an actual bank services provided by the bank.
location with all of those additional costs, fees 9. Transfers: Transfers between accounts
can be compact and are often non-present with the same financial institution online can be
Those checking and savings accounts that are done almost instantaneously. Not only is there
offered by completely online banks usually have no hold on the money being moved around, you
no fees at all. Depending on the type of account can do it every time you like and from anywhere
you at this time have, you could be saving You also save time on travelling to the local
anything from $60 a year and up. branch. Even transfer to additional financial
4. Higher Interest Rates: Again, due to a lack institutions is easier, and safer as you don’t
of costs associated with running an online bank, have to carry the money around with you. You
higher interest rates are often accessible for can even now e-mail money to and from other
their accounts. For higher concentration rates, people with INTERAC e-mail money transfers.
you would usually need to bank with a
completely online account.
5. Online Statements: Most online banks try to be
as paper-free as possible. Most statements and
correspondence is done online, reducing the amount
of paper used and sent out to you. This again will
help reduce the costs of the online bank. As an
added bonus, this makes online banking a great
ecological choice. Be warned, some banks do charge
if you do want a paper copy of something.
6. Direct Deposit: With any incoming money,
such as your salary, you can arrange for it to be
immediately deposited into your bank account Features Available Through Online Banking
by the company sending the money. This is 1. View balances: Checking your balance
essentially a double benefit, as you don’t have doesn't require much work. You simply select
to take the time to deposit the check, plus the Account balances and take a look at your
money goes into your account faster allowing balance and past statement If you have more
you to earn interest that much quicker. than one account, you can also do transfers
7. Automatic Bill Paying: With automatic bill between accounts.
paying, you can automate paying your monthly 2. Pay bills: To pay your bills online, you just
bills. Of course, you need to set this up, but it need to add to your account the names of the
will be worth it in the long run. First, with your companies you wish to pay bills to. In the Pay
bills being paid normally you shouldn’t ever Bills section, select Add payees, search for the
miss a payment. Plus, by not having to worry name of the company and fill in the account
about the time taken to mail in your payment, number for each company. You can also sign
you can keep your money in your account for a up for the ebills service from epost, a facility that
bit longer, earning you a little bit more interest – sends you a bill by email instead of a printed
and you save resting on postage too. Finally, one by regular mail.
you can actually do away with using checks and 3. Transfer funds: When you select Transfer
you also save on paper used, making this a Funds, you'll be asked where to transfer the
much greener way of banking also. money to and from, when, and the amount.
107 Bodhi International Journal of Research in Humanities, Arts and Science
 Vol.2 Special Issue 13 April 2018 E-ISSN: 2456-5571

4. Set up recurring bill payments or be more difficult (or impossible) with some
transfers: If you make a regular payment every direct banks.
month, it might exist convenient to set up an If you regularly deposit cash, a traditional
regular extraction from your account. bank with a drive-through window may be more
5. Monitor CIBC investments: If you have practical and resourceful. Another probable
any CIBC investments, you can keep an eye on drawback is that most direct banks do not have
those stocks or mutual funds here. their own ATM machines. Unless an internet
6. SendandreceiveanINTERAC bank has a network alliance with another bank,
e-TransferTM2: This could be the end of the you will be charged for your ATM use.
birthday cheque! You can receive transfers from 3. Service Issues
other people's accounts, or set up transfers from Some direct banks may not offer all the
your account to someone else's. The recipient will comprehensive financial services, such as
get an e-mail notify them of the transaction. insurance and brokerage accounts, that
7. View CIBC VISA* accounts: Always a traditional banks propose Traditional banks
good place to monitor your spending. You can sometimes offer special services to loyal
build your credit card payments online, right customers, such as preferred rates and
from your account. investment advice at no extra charge.
8. Order cheques: We don't need them much In addition, routine services such as
anymore due to online banking and debit notarization and bank signature guarantee are not
purchases, but if you still use cheques, you can available online. These services are required for
order them honestly from the CIBC website. many financial and legal transactions.
4. Security
The Drawbacks Virtual Banking Direct banks are subject to the same laws and
Banking exclusively online also has its share of regulations as traditional banks, and accounts are
drawbacks and inconvenience These include: protected by the FDIC. Sophisticated encryption
1. Bank Relationship software is designed to protect your account
A traditional bank provides the opportunity to information, but no system is perfect. Accounts
develop a personal relationship with that bank. may be subject to phishing, hacker attacks,
Getting to know the people at your local branch malware and other unofficial activity. However,
can be an advantage when you need a loan or one advantage of online banking is that you are
a special service that is not normally offered to likely to find a security breach more fast,
the public. A bank manager usually has some because your account balance is so accessible.
discretion in changing the terms of your account Most banks now make scanned copies of
if your personal circumstances change. They cleared checks available online, which helps to
can help you solve problems such as reversing avoid and identify check fraud. It enables
an undeserved fee or service charge. verification that all checks are signed by you and
Your banker will also get to know you and that dollar amounts have not been transformed
your unique needs. If you have a business The timely discovery of discrepancies can be
account, this personal relationship may help if you reported and investigated immediately.
need capital to expand. It's easier to get the bank's Identity theft is a significant concern, but
support if there is someone who understands your some online banks take this risk more seriously
business and can vouch for your operating plan. than others. Before opening an online account,
2. Transaction Issues thoroughly investigate the bank's security
Sometimes a face-to-face meeting is required policies and protections to ensure they meet
to complete complex transactions and address your expectations.
complicated problems. A traditional bank can host 5. The Bottom Line
meetings and call in experts to solve a specific The rise of internet banks has increased the
issue. In addition, international transactions may competition for your banking business. With both
online and brick-and-mortar banks suggest unique
108 Bodhi International Journal of Research in Humanities, Arts and Science
 Vol.2 Special Issue 13 April 2018 E-ISSN: 2456-5571

benefits and drawbacks, it may not be wise to do and HDFC”, Advances in Management, Vol.
your banking exclusively with either option. While 4(2) September, pp. 43-53.
it's not possible for everyone, the best play may be 2. Gokilamani, N. and Natarajan, C. (2014).
to split your banking between both in-store and Service Performance in The Retail Banking
online services and benefit from the conveniences of The Commercial Banks in Coimbatore
and savings of internet banks while maintaining District: An Empirical Assessment,
the customer service and personal relationships a Research Explorer, 3 (8), 27-31.
physical branch can provide. 3. S.H.Rehana Banu, “Customer perception and
Response towards Online marketing in
Conclusion Chennai City”, Asia Pacific journal of
In this study, any inquiry or transaction is Research, ISSN: 2320-5504, Vol. 1, Issue-
processed online without any reference to the XXVII, May 2015, pp.44-56.
branch (anywhere banking) at any time. 4. Sonal Thakur, “Consumer Perception:
Providing internet banking is increasingly A study on E- Marketing”, International
becoming a 'need to have' than a 'nice to have' Journal of Recent Research Aspects ISSN:
services. Delivering superior service quality 2349-7688, Vol. 2, Issue 2, June 2015, pp.
appears to be a prerequisite for success of any 256-262.
service firms. As electronic banking becomes
more prevalent, now-a-days customers are Website
evaluating banks based more on their “high- 1. https://en.wikipedia.org/wiki/Online_banki
touch” factors than on their “high-tech” factors in ng
most of the developing economy like India. 2. https://www.thebalance.com/how-to-pay-
your-bills-online-2385977
References 3. http://bankingallinfo.com/2012/08/15/onlin
1. Prasad, K.V.N. and Ravinder, G. (2011), e-banking-3/
“Performance Evaluation of Banks:
4. http://bankingallinfo.com/2015/08/29/onlin
A Comparative Study on SBI, PNB, ICICI e-banking-2/