Disadvantages of Internet Banking

Internet banking or electronic banking allows customers to access their accounts at any time from any computer or smart phone. This banking style has a lot of advantages, including 24-hour account monitoring, the ability to bank from anywhere and fast transactions. However, this system has some distinct disadvantages, too.

Identity Confirmation

Federal regulations require that financial institutions confirm each customer's identity. This may present a logistical issue, as copying and faxing documents is sometimes necessary.

Security Concerns

With hacking and identity theft on the rise, Internet banking customers have to place a certain amount of trust in the bank that their account information and personal information are safe.

Customer Service

If you bank at a traditional bank, you can go to the bank and speak to someone face to face about your problem but, with an Internet bank, you will likely spend a lot of time on the phone being passed around and placed on hold.

Accessibility

If the Internet goes down in your area or the area of the banking office, you will be unable to access your accounts. This includes being unable to withdraw money from ATMs or to use your debit card.

Fees

Many Internet banks don't have ATMs, which means you will have to pay ATM fees. This can cost you more money than paying the regular monthly fees at a brick and mortar bank.