Online banking is booming

Once a niche market, online banking has grown into a widely-used tool for the average consumer.

Among 3,988 adults surveyed in the U.S. by Gartner Group, 47 percent said they now bank online. In the U.K, 30 percent echoed the same response.

Results varied according to income. Gartner found that over half of all consumers earning more than $30,000 in the U.S. and 15,000 pounds in the U.K. bank on the Internet. Among lower-income households, 25 percent in America and 17 percent in the U.K. use online banking.

"Over the past several years, online banking has been seen as a way of appealing to more affluent and younger clients," said David Schehr, Gartner research director. "However, what is becoming clear is that the overall level of consumer Internet use and the increasingly narrow segment of nonusers--particularly in the U.S.--are shifting the dynamics of who is using online banking and what they seek from it."

Among people who don't bank online, no one single reason was cited above all others, noted Gartner. Around 61 percent of U.S. households and 58 percent of those in the U.K. said they simply prefer to use other methods. However, 41 percent of U.S. consumers and 38 percent in the U.K. blamed security as the most important reason for not banking over the Internet.

"To strengthen their position and better support these customers, banks need to add more payment options, deploy online and mobile alerts with greater visibility, and continue to hammer home the message that online bill payment is free."

--Edward Kountz, Forrester senior analyst

Gartner conducted its survey in December 2008 and January 2009 and questioned people 18 years and older.

Overall, the number of households paying bills online is slated to jump 5.4 percent from 48 million this year to 63 million by 2014, according to another report from research firm Forrester.

The report notes the effect of bill consolidation sites, such as Yodlee and Corillian, where consumers can manage and pay all their bills. Such sites are starting to woo more people from the banks' own bill payment sites and will own a greater share of the market by 2012. Banks will need to do a better job spreading the word about their own online services, according to Forrester.

"eBusiness executives at banks need to work to establish earlier and stronger bill payment relationships with young affluents and other young adults," said Forrester senior analyst Edward Kountz. "To strengthen their position and better support these customers, banks need to add more payment options, deploy online and mobile alerts with greater visibility, and continue to hammer home the message that online bill payment is free."

[kzemach]

It would be nice to see the effect and percentage ownership of "true" online billpay companies, like www.myezbills.com; there are a few others out there too. I've been using them for about 9 years now (was paymybills.com), and they are leagues ahead of regular online banking... at a price. Not only are my bill paid online, but my paper bills are received for me, opened, scanned, and auto paid without me going to the mailbox. I can leave the country for a year, never check anything, and all my bills will be paid properly and on time. It's fantastic for someone who travels a lot for business.

[ismetd]

With the transformation of banking from brick to online, I wander what the effects of "online banking" will be on the banking industry itself? will the traditional banks be less important? will it be the companies who makes better software (such as Google) become (best) bankers?

[janatthecomp]

For me the emergence and popularity of online banking was bound to happen not only due to the convenience but the instant gratification. In other words, knowing exactly what's in your account at any given time, when checks have gone through, etc. That was always one of the primary issues with banking and a solution was bound to come as new technologies developed.

Security is becoming less of an issue now, and I find it ironic that most victims of identity theft do not lose their private info through online banking but through physical checks or brick and mortar debit card usage. Most online banks are protected via Extended Validation SSL, which has become "de rigueur" encryption due to the unspoofable Green URL bar. My info has never been compromised as a result of online banking.

[anami_banking_online]

I agree that it is a booming. Many people searching, asking abour banking online. it Caused many reasonns. Banking online nowaday is a solution. Many big company banking making banking online serveing. such as wellsfargo group with wachovia banking online

regard

seisaku ( http://banking-online.us/wachovia-banking-online )