History of Online Banking

History of Online Banking

Technology has made it easy for many industries to operate a business online. With banking, even the slightest thing like money withdrawal or checking account balance required one to visit the physical location. Today, most digital banking tools are offered online; therefore, it’s easy to access using your personal phone or computer.

What is online banking?

Like the term itself, this is a process of accessing financial transactions using the internet. It is conducted by using electronics like phones and computers to withdraw money, deposit, pay bills, etc. It is also called web or internet banking. Consumers can do this at their own convenience, so there is no need to visit any bank branch.

The history of internet banking

It started back in 1980 when technology started to rise and later became famous around 1990. in the past, most people used to make trips to the physical bank location for their financial needs. It has become easily accessible to many since almost everyone owns a computer or phone that they can use for transactions. Its evolution has grown, making online banking the most reliable method of depositing and withdrawing money. Below is the development of internet banking throughout time.

Test at home banking in New York City

It began in 1981 in New York City, which is considered the first place to experience internet banking. The services were provided remotely by visiting homes. Chemical Bank and Citibank Chase are the banks that ensured their customers benefited from the new banking version. They are also considered the first banks to understand and provide internet banking to people.

Banking services in Scotland

During this period, the UK invented a method by which clients can access online banking easily. The process was to use phones and TVs through internet connection then send money or pay bills through the devices. Since it was an analog method, it took time to do transactions compared to modern days.

Presidential bank leads

In 1994 the US was able to provide online banking to its people through the help of Stanford Federal Credit Union. It was the first bank to come up with online accounts that every person could own financially. Since then, internet banking has become so popular that most banks worldwide have started implementing the same.

The founding of the Bank of Internet in the USA

In 1999 the Bank of Internet USA was founded and officially started doing business in 2000. It was the biggest bank at the time with a massive number of clients. However, higher rates were applied when banking online. It also had other benefits like sending and withdrawing money from any location without visiting the bank’s physical site. The bank also provided an easy way for people to invest and quickly request loans.

The growth of Bank of America

During the year 2000, most people started to understand more about online banking. During this time, the Bank of America gained many customers over millions, which made it recognized as the best. Many people started investing and applying for online banking after realizing its advantages. The bank’s popularity spread the word through regions about the easiest ways to manage their finance online.

Evolution of Internet banking

In 2006, online banking had become so common that many banks invested in it. Many banks began to offer online services to their clients, which increased the number of customers at a tremendous rate. It was now obvious how popular internet banking was, and many people relied on such services to pay their bills and save their investments.

The breakthrough of online banking

In 2010, online banking was growing faster than the internet itself. This is due to the collaboration of many banks and the provision of online services to customers. Due to the rapid increase of technology use, many people owned devices like cell phones that allowed connection to online bank accounts. This made it easy for everyone to access, making it even more popular. Every person that had a phone and access to the internet owned an online banking account that played the same purpose as the physical one.

Online banking in 2018

at this time, the idea of banking online was worldwide, and almost every person was using the services. Through accessing apps and other online platforms, people can now pay their bills send money and other financial things at a cheaper rate. It became easy for entrepreneurs to do business worldwide using online platforms that allowed them to send money fast and efficiently. Online banking continues to upgrade each day by providing easy financial solutions to people.

How to secure online banking

There are many ways people can secure their online banking accounts. And since it has become so popular, people are looking for ways to hack or steal money from these accounts. As a person with an online account, you should put a strong password that is hard to crack. Also, you can enable two-factor authentication from the bank you are using. Another thing is to avoid disclosing your information like pins to other people to secure the account. When using the public internet, always log out when done to avoid leaving your information to other users. The bank itself provides encryption technology that secures the user’s account. Such features warn the user about any malicious activities happening to the account without their consent. Such ensures that they confirm with you first to block any fraud activities. 

How to avoid attacks

There are various ways online banking users can prevent attacks from frauds. One of the ways is to ensure that the operating system well attaches the account. Another method is using a security process that consists of the user double-checking the data against any attacks from outside. This will prevent any outside activities from entering the account, making it secure and safe.  

Online banking features

These are features included in internet banking to make it easy for people to operate and use. Apart from depositing and withdrawing money, these features make the online banking process easy to follow and keep track of money. It also prevents one from making unaccountable transactions from the bank. They include balance and transaction viewing, ordering checkbooks, downloading applications, account statements, and others. 

Customers can also benefit from services like money transfer, paying bills, investing, applying for credit cards, and loan applications. Financial institutes offer other services like financial management support that allows clients to access their account information from any location without logging in. It also applies when dealing with other institutes, enabling easy monitoring of all the online accounts.

Even with the slow evolution of internet banking, it has proven that more upgrades are coming in the future. Online banking services have played a significant role in improving technology and making the financial industry more accessible to people. Its only by its upgrade that there is no more usage of landlines, making trips to banks, and other analog ways of accessing money. Today, you can deposit and withdraw money from any location by clicking on your mobile phone. It’s also easy to invest and do business with online banking. In the future, internet banking will likely be more advanced and easier to use, just like it has been upgrading over time.

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