Online Banking (posted 6/16/98)

(Posted 6/16/98)

On-Line Banking
By; Susan Kushnick

By the end of the year, almost half of all the banks in the United States will offer some services online. What does this mean for small businesses?

Welcome to the world of cyberbanking, where with the click of a mouse you can make deposits, pay bills, and even get loans approved. What you can't do is cultivate a relationship with a live human banker--someone who could push for a loan approval, for example, or help get a check stopped if you need it. That said, online banking is still a great time saver and a tremendously convenient option if you use it in addition to a "bricks-and-mortar" bank.

Finding Online Banking Services

Although most major banks have Web sites, not all of them offer online services. Here are examples of some that do.

Bank of America ( http://www.bankamerica.com/ and on America Online at keyword: Bank of America). From the Bank of America site on the Web or America Online, you can:

Apply for credit cards
Transfer funds between accounts
Pay bills
Access bank statements
Get economic forecasts

Baybank's Homelink ( http://www.BayBank.com/ ). BayBank's HomeLink is an online service that allows customers to:

Transfer funds
Make inquiries about balances, statements, and checks
Inquire about balances, statements, and checks
Make payments to BayBank credit cards or lines of credit
Pay bills

Security First Network Bank (SFNB) ( http://www.sfnb.com/ ). In 1995, SFNB became the first fully transactional Internet bank. Today, SFNB offers the following online services:

20 free electronic payments monthly
Online statements and registers
Online images of cleared checks
Transfer of funds to linked accounts
Visa cards to prequalified customers with transactions updated as they clear and "one-click balance payment"
Savings accounts
CDs and money market accounts

Wells Fargo ( http://www.wellsfargo.com/ and on Prodigy at Jump Bank). At Wells Fargo's sites on the Web and Prodigy, you can:

Pay bills
Apply for lines of credit and loans
Open and access information about checking, savings, CD, and credit card accounts

Be Careful Out There

Although according to the U.S. General Accounting Office, no major online banking problems have been reported, there have been some cases of service lapses, unauthorized access, and even employee sabotage. So take some security precautions:

Always keep PIN numbers confidential.
Use antivirus software to be sure your systems stay uncontaminated.
Deal with a bank that uses encryption technology. (BayBank, Bank of America, and Security First all utilize encryption for online transactions, for example.)
Upgrade often to the latest version of the banking software. Using older versions gives hackers more time to analyze systems and find ways to get in. Over half the banks that offer online services will upgrade your software automatically, so it's worth it to find one that does this.

Susan Kushnick is a business writer, editor, and researcher based in New York. She has contributed material to If You're Clueless About Starting Your Own Business, The America Online Insider's Guide to Finding Information Online, and the upcoming Kinko's SOHO Sourcebook.