Internet Banking – Matters To Fact

Internet banking is the new buzz word around the corner. Forget traditional banking and the way you used up to queue to get the transactions done. Internet banking is here to change that all. Now banking is no more taking out time from your schedule and to start with finding a place in the car park and then waiting for your turn to get to the counter. Internet banking gives you the freedom to do banking at your finger clicks.

The easiest and the safest way of banking is here. Introduce yourself to internet banking. Now you can do the transactions sitting right into your office cubicle or from your home. It can be said that with this the new era of banking has arrived and for the better of it. Internet banking is simple for anyone who has a access to internet. It certainly is beneficial compared to the traditional way of banking. You simply use internet instead of using paper or phone to access your account and can enjoy it from virtually anywhere, even if you are on a vacation to Bahamas. Secondly you can have the reports like your account information, monthly statements, reconciliation reports etc. whenever you want to access. No calling up to the bank or the customer care to get a work done, everything is conveniently at the fingertips.

The major concern of a few was the security of Internet banking which is till now well addressed by the security applications or firewalls used by the banks providing this facility or the online banks. Every transaction made through internet banking is completely safe and can be relied upon. Although there are some issues which one need to understand to keep the security levels high. You should try to avoid accessing your account from unsecured lines or machines. In any case do not revel your banking ID and password to anyone even if trying to pose a bank employee. These are the few things which make your internet banking experience wonderful and safe.

There are many benefits of using internet banking like

o It saves a lot of time and effort.

o Can transact with the click of a button.

o Completely safe and secure.

o Fewer fees with most of the services rendered free.

o Can coordinate with your financial software.

o Easy to understand and to use.

o Scores more points over traditional banking.

o Useful for everyone.

That’s why internet banking is a popular service now used by millions of account holders worldwide. Now with the fast growth in the number of users opting for internet banking a no. of online banks is building up to provide service to the customers. These online only banks are virtual but provide quality service to customers offering them with many new and exciting features.

Internet Banking – What You Need To Know

Internet banking has brought revolutionary changes to the financial world. Now, it has become much easier for you to perform various financial transactions over the Internet right from the comfort and privacy of your home. With the rapid popularity of Internet banking, opening a bank account and performing various transactions are now just a click away. Now there is no need to stand in the queue in order to get a bank account opened.

Technical Requirement To Access Internet Banking

You will be happy to know that you do not need any special hardware or software installed on your computer in order to access Internet banking. All you need is a computer system with Internet access, and you are ready to go. You are given a login ID and password to access your bank account. In most cases, the login ID is either the bank account number, or credit card number or ATM cum Debit card number.

Features Of Internet banking

Some of the tremendous array of features that Internet banking has to offer includes the following:

o You can get the bank statement right in your email inbox. If you are a businessperson, the online bank statement can be very advantageous for you. For example, you can import the data of the bank statement in a personal finance software program such as Quicken or Microsoft Money.

o The facility of electronic fund transfer is a great plus with Internet banking. You can send money online from one account to another either in the same bank or in any different bank.

o You can even make payments for your various utility bills like electricity and telephone bills, from your online bank account.

o You can also use your online account to purchase or sell investment products, such as shares, mutual funds and much more.

o Using the Internet banking, you can comfortably apply for various loans.

o If you have more than one account in a bank, the Internet banking allows you to access the extensive details of all your bank accounts at one place.

However, if you want to keep your experience with the Internet banking safe and pleasant, it is important for you to keep your personal information private and secure, such as your login id, password etc. Again, you should also make sure that when you are through, you log out from your online bank account thoroughly.

Offshore Internet Banking Advantages and Disadvantages

The topic of offshore internet banking is a hot one and one that is increasingly growing in popularity not only within the consumer banking community, but also the business or corporate banking sector.

The beauty of offshore online banking is that in addition to enabling you to conduct banking activities allowed by traditional and local brick and mortar businesses, it allows you more variety and flexibility in terms of your banking needs. For example, if you travel often, offshore online banking gives you the flexibility to conduct business on to go from anywhere, while ensuring that you have access to the type of currency if you need at a time you need it.

Having said that, not all banks offer online or internet banking services as this service costs the banks a significant amount of money. Programming sophisticated and secure systems require the effort of several full time computer engineers, full security and compliance departments, as well as heavy overhead to support the service on an ongoing basis.

Because there are so many variables involved in offering this service, offshore internet banking services vary from one financial institution to another. Some have better systems while others have work to do. A lot of this is predicated on the resources the bank has dedicated to this initiative, both in terms of quantity and quality.

Opening an Offshore Bank Account

Before diving further into this topic, I want to clarify that engaging in offshore internet banking is not about evading taxes. It is about mitigating risk of capital loss due to no fault of your own. So when considering a foreign jurisdiction in which to establish an offshore bank account, consider one that is politically stable and financially strong. In addition, it helps to select a jurisdiction that pays an attractive interest rate and has low to no income tax. Some of the most preferred jurisdictions over the years have been Switzerland, Cayman Islands, Singapore, Hong Kong and the United Arab Emirates (UAE).

Opening a personal bank account is usually a very personal activity. With offshore internet banking however, there are ways you can get started remotely without having to show up to the bank’s local office, saving a ton of time, money and mainly frustration.

One such way is by visiting a local bank’s branch in your domicile state, or home country. Many big banks that offer internet banking have a multi-national presence. Chances are good that your selected bank has a local branch near where you live, despite being headquartered in another offshore jurisdiction.

In other cases, there are international banks that may not have local branches near where you live, but are willing and able to establish an offshore bank account for you through email, snail mail, fax and telephone. There are usually a set of documents required by banks in order to execute this process. Therefore you can still open a foreign bank account with an offshore bank without having to leave your country, but it may come with a little more effort, and sometimes the struggle involved in communicating with someone overseas.

The Advantages of Offshore Internet Banking

Here are some advantages of offshore internet banking that you should know about.

Protection from sovereign risk – as mention already above, parking funds in foreign bank accounts mitigates the risk of loss of capital resulting from freeze or confiscation of funds by Governments without any fault of your own. This risk is less of a concern in a developed economy with a solid banking infrastructure such as the United States, but it is nonetheless an inherent risk that exists.

Tax benefits – many offshore jurisdictions have low to no income tax implications on interest income, or income from business activities.

Higher Interest Rates – because many offshore banks operate with low costs, they can afford to offer higher interest rates compared to larger multi-national names. In fact, in developed economies like in Europe and North America, regulatory compliance requirements is seen by many as form of taxation on banks, thereby increasing overhead costs and lowering interest rates.

On Demand Access to Statements – offshore internet banking gives you instant access to your statements where you can view your activities on a real time basis. This includes past and pending deposits and withdrawals. You can therefore access your account balance at anytime.

Money Management – with offshore internet banking you can transfer funds between accounts across the globe instantly. Offshore banks have inventories of various currencies and can help you fulfill banking transactions in multiple countries. You can schedule automatic payments to vendors to release automatically.

There are several other advantages to offshore internet banking. You can open offshore trading accounts and establish offshore brokerage accounts to conduct trading and investment activity (there can be tax advantages to this). Conducting transactions online is not only mostly free, but also very efficient. Transaction time online is simply much less. You can also have streams of income potentially directly deposited straight into your offshore online bank account.

From a personal finance perspective, downloading banking activity from your offshore online bank account is easy and can be done instantly. Most online banking platforms are designed to feed information into financial or personal accounting software or to spreadsheets like Excel. Individuals can save a significant amount on accountant fees just by utilizing this feature. Not to mention more intimate knowledge and management of their own finances.

For those looking for anonymity, offshore online bank accounts also allow you to conduct banking anonymously as per bank secrecy guidelines.

The Disadvantages of Offshore Internet Banking

Merely establishing an offshore bank account can be a reason for the Government to put more focus on your activities. After all, many use offshore internet banking as a mechanism to conduct illegal activity and evade taxes. Some specific disadvantages of offshore internet banking as a result of conducting business through foreign bank accounts are the following:

Knowledge of Internet – There is a certain level of internet savvy required to be able to navigate your way through offshore internet banking platforms to ensure you are getting exactly what you want. This is a big reason why some elderly shy away from conducting banking online.

Deposit Timeline – Because many banks do not have the technology to be able to collect deposits remotely, you may have difficulty depositing all your proceeds. While many banks have developed electronic scanning technology, others have yet to catch up. There is no consistency to say the least.

Security / Fraud Implications – because banking is conducted online, offshore internet banking exposes you to the risk of network intrusion or breach. Because information is transferred electronically and stored in various databases, breaches can cause private and sensitive information to leak out into the wrong hands. But then again, this is no different than losing your check book if compared to traditional brick and mortar banking.

Spam Mail – offshore online banking also means that you will receive emails from the foreign bank you have your offshore bank accounts with. Internet predators recognize this as an opportunity for phishing, or fish for private and sensitive information. Many times you may see an email in your inbox from what seems like your foreign banking institution. However it is not. These are phishing emails hoping for you to login and enter your personal information such as login and password.

TIPS: Here are a few tips to avoid falling for phishing scams. First, when you receive an email from your bank, call them to verify that they sent the email. Second, instead of opening the email they sent you, visit the bank’s website directly and see if you can conduct what’s asked of you on their site by you logging in directly rather than clicking a login link in an email message.

Third, if you were to open the email and click on any link in it for whatever reason, once the link takes you to a website where you are required to enter personal information, look for security symbols such as an https URL address or a padlock on the lower right hand side corner of the web browser. There are other security measures as well that can be visible spotted. Read online for more on this topic.

Financial Security – some offshore bank locations are not very financially secure or stable. For example, during the global economic crisis of 2008, many savers lost money parked in offshore bank accounts in some destinations such as Iceland. I don’t mean to scare you by any means as this situation is rare, and in most cases those who suffer losses are compensated in some way over time. However, know that this inherent risk exists. Always look for deposit insurance. The bigger the allowance the better.

Credibility by Association – as I’ve already mentioned, offshore internet banking has negative connotations attached to it, often associated with money laundering, use of illegal monies, untaxed monies and support of illegal causes. Offshore bank accounts at times are tied to crime rings and terrorists. What does this mean for you? Although you may engage in offshore banking legally and legitimately, understand that there will be closer scrutiny over you by the Governments.

Access Restrictions – offshore banks are in destinations far away from you, therefore more difficult and expensive to access. In many countries, communication in person is preferred to communicating over phone, email and snail mail, therefore internet banking can get a bit difficult and frustrating. I see this trend slowly changing with banks understanding the need to communicate at all levels and mediums to satisfy a global audience.

Expensive – offshore internet banking is usually more expensive to set up and administer and thus more accessible and feasible for those more affluent or high income earners. It’s not so much that it is expensive to open a foreign bank account. It is not. However, many times you will need to go through a firm that specializes in helping expatriates establish and manage foreign bank accounts. All these activities cost money.

Internet banking today is very convenient and is accessible to almost everyone. For the average individual it can be a great offshore tax planning tool to add to the mix. For those that travel, foreign internet banking can provide all sorts of convenience, allowing one to transact anywhere and with anyone. So if you liked what you read about offshore online banking, I highly recommend you look into it further to see how it can help you meet your objectives.