Ask The Expert
Bank Safe Online
With the internet being so accessible more and more of us are banking online. High street banks, keen to cut staff and costs, are pushing their online services and are encouraging us with an array of tempting offers. But while it may be convenient to check our balance from home, are we putting ourselves at risk?
Hi,
My daughter has an online bank account and she is always trying to get me to sign up for one too because she says it saves you having to go to the bank all the time. But how safe is online banking really? Is it easy for someone to get into your account if you've accessed it from a public computer? And is it really worth all the hassle?
Thanks for your help,
Laura
UKTV Style's Agony Aunt replies:
Hi Laura,
There's no doubt that banking has changed. The online bank Smile, which is owned by the Co-op, has a happy 'pink' website and is clearly designed to draw you in and make you feel cosy and safe. They also claim to be 'ecologically sound' and promise to take care of your 'heart and your wallet'. Which is nice... but you are right to be cautious and I think it might be worth examining the real pros and cons of these kinds of banks before opening an online account.
There are lots of tempting offers about. Alliance and Leicester are offering one of the highest interest rates on current accounts around at the moment - 5% AER fixed, until September 2006, on their Premier Account. In addition, you get a 0% overdraft and a savings account at 10.00% gross per annum AER when you apply online. They will also offer to enter you into their £2000 prize draw if you pay just one bill or transfer some money using their online service. See the Alliance and Leicester website for more details.
The online banks also offer interest on current accounts and other incentives. One of those is first direct (who offer online, phone or mobile phone banking), will pay 2% AER, give you a free £500 overdraft and a gift of £50 when you switch to their service. Smile pay 3.3% AER and also offer a £500 overdraft, free of charge.
For more information on comparing online banks' rates and services, log on to Financial information net directory (Find).
So what are the benefits? Good interest rates on current accounts are a plus; as is being able to check balances and arrange standing orders 24 hours a day. Many online banks also offer the ability to transfer cash electronically between accounts and some will even send information, via text, to your mobile.
My daughter has an online bank account and she is always trying to get me to sign up for one too because she says it saves you having to go to the bank all the time. But how safe is online banking really? Is it easy for someone to get into your account if you've accessed it from a public computer? And is it really worth all the hassle?
Thanks for your help,
Laura
UKTV Style's Agony Aunt replies:
Hi Laura,
There's no doubt that banking has changed. The online bank Smile, which is owned by the Co-op, has a happy 'pink' website and is clearly designed to draw you in and make you feel cosy and safe. They also claim to be 'ecologically sound' and promise to take care of your 'heart and your wallet'. Which is nice... but you are right to be cautious and I think it might be worth examining the real pros and cons of these kinds of banks before opening an online account.
There are lots of tempting offers about. Alliance and Leicester are offering one of the highest interest rates on current accounts around at the moment - 5% AER fixed, until September 2006, on their Premier Account. In addition, you get a 0% overdraft and a savings account at 10.00% gross per annum AER when you apply online. They will also offer to enter you into their £2000 prize draw if you pay just one bill or transfer some money using their online service. See the Alliance and Leicester website for more details.
The online banks also offer interest on current accounts and other incentives. One of those is first direct (who offer online, phone or mobile phone banking), will pay 2% AER, give you a free £500 overdraft and a gift of £50 when you switch to their service. Smile pay 3.3% AER and also offer a £500 overdraft, free of charge.
For more information on comparing online banks' rates and services, log on to Financial information net directory (Find).
So what are the benefits? Good interest rates on current accounts are a plus; as is being able to check balances and arrange standing orders 24 hours a day. Many online banks also offer the ability to transfer cash electronically between accounts and some will even send information, via text, to your mobile.
