The Pros and Cons of Choosing an Online-Only Bank
The world has moved on to the internet and in most parts of the US, regular banking work is done largely over the web. In fact, the internet has become so vital to the process of banking itself that a number of banks are now doing business online-only.
This means that they hardly have any physical branches like the usual banks and almost anything and everything is done via the internet or the phone. As more new banks are beginning to take this route for the obvious financial advantage this mode of business has, it’s time to take a look at the pros and cons of going with an online-only bank.
This is without a doubt the number one reason why online-banking came into existence in the first place, but online-only banking took it to the next level. To have the convenience of doing all banking work from the convenience of your smartphone or laptop automatically speeds up everything and saves you the time and hassle of physically commuting to and from a branch.
An online-only bank doesn’t have to worry about maintaining actual physical branches across multiple locations in the country and abroad. Can you imagine how much of an economic advantage this puts these digital banks in? As a result of that, the best online banks offer more profitable incentives to their customers such as better deposit rates, free accounts, no-minimum balance accounts, higher interest rates on savings accounts and lower interest rates on loans.
Better Online Facilities
The internet banking facilities at an online-only bank are not only as good as the internet banking facilities offered by any traditional bank out there, but they are actually a lot better. It is to be expected, of course, given that the online representation of the bank is pretty much what people will judge it for.
Traditional banks must use paper and electricity on a daily basis to operate, and when you count in the fact that they usually have multiple branches, the total consumption is most certainly not eco-friendly. Online-only branches don’t have much use for paper and a lot less electricity in comparison, so they are definitely taking the more eco-friendly route.
This one is perhaps the most significant issue which plagues all digital banks in general; it’s very difficult to deposit hard cash. While most digital banks do have a few branches for cash deposits and other services as required, you are out of luck if that branch happens to be way too far from your current location and you need to deposit hard cash quite frequently.
Digital banks are most likely the future of banking, but as of now, older generations do not have confidence in them because they don’t understand it. This is why it may still take a while before everyone gets used to the idea of banking without actually going anywhere. Having said that, unless you are someone who cannot handle the basic functions of a smartphone or a computer even in this age, there is practically no reason why you should not at least have an account with an online-only bank.