Online Banking

Online banking allows bank account owners to transfer various amounts of money and manage their banks remotely via the use of the internet. Nowadays many of the major banking chains offer this service to their customers, this includes: Natwest (http://www.natwest.com/personal.ashx), Lloydes TSB (http://www.lloydstsb.com/), Halifax (http://www.halifax.co.uk/home/home.asp), Bank of Scotland (http://www.bankofscotland.co.uk/), HSBC (http://www.hsbc.co.uk/1/2/) and more. This advancement in technology is largely what has allowed the internet to become the thriving source of commerce it is today. It has done so by enabling the public access to the seemingly endless supply of goods and services the internet has to offer. Due to its huge success, people have speculated that in the future high street banks shall shut down and become fully replaced by online banking.

Online Transfers -

Online banking allows people to transfer money to different bank accounts via the internet. This is extremely useful as it lessens the need to visit banks in person, therefore both saving time and money (travel costs, etc) and providing them with an easier and more enjoyable banking experience. It is often relatively easy to perform online bank transfers. The data normally required tends to be credit or debit card information (card number, card holders name, etc), personal information (address, first name and surname, telephone number, etc) and bank information. Once sites have the information needed, users may proceed to transfer various amounts of money to others. Sites which allow people to perform online transfers include: Paypal (https://www.paypal.com), Lloyds TSB (http://www.lloydstsb.com/), HSBC (http://www.hsbc.co.uk/1/2/) and more.

Direct Debit -

Direct debit is a financial transaction in which funds are taken from a person’s bank account. Typically direct debits are used for recurring payments such as gas bills and credit card payments. Before the payments can take place, the account owner must notify their bank to inform them about the direct debit. However, once set up the amount of money being paid is able to change without notifying the bank.

Smart Phones -

Today people are able to make important bank transfers via the use of their mobile phones. A variety of ‘apps’ and websites are now available to make this possible. These include:

• Barclays Pingit (http://www.barclays.co.uk/PersonalBanking/P1242603570446?WT.mc_id=301RDpingit)
• NatWest App (http://www.natwest.com/personal/online-banking/g2/mobile-phone-banking.ashx)
• Lloyds Mobile Banking (http://www.lloydstsb.com/internet_banking/mobile_banking.asp)
• And many more (see article: http://www.thisismoney.co.uk/money/saving/article-2148602/Best-banking-apps-Our-verdict-Pingit-First-Direct-HSBC-Lloyds-NatWest-Santander.html)

Due to these advancements, banking is now available at any time almost anywhere (provided that it has internet connection) to anybody with a new enough phone.

Scams and Hacking -

Despite the many advantages of online banking a fairly large amount of people are unwilling to use it as a service. A major reason for this is due to the existence of scams and hacking. Scams trick users into giving away their money to the maker of the scam or various misleading websites. One of the most popular scams is the ‘Nigerian Scam’ in which a supposed wealthy foreigner (whom tends not exist) who needs assistance moving a vast amount of money from his homeland and in return with reward the person with a percentage of the fortune. The scammer will then collect the victim’s bank and credit or debit information in order to steal their money. Here is an example of one of these scams:

(Source: http://www.snopes.com/fraud/advancefee/nigeria.asp)

Another form of scam that can be found online is the selling of false items. These scams will trick the victim into believing that they are legitimately purchasing an item online, however the scammer will take their money or bank/card information (which will later be used to steal from the victims bank account) and never send them the item which they believed they were buying. Here are some links to various scam stories which have appeared in the news:

• £4,000 lost in online Puppy scam (http://www.bbc.co.uk/news/world-europe-isle-of-man-18968077)
• Woman duped out of £1,000 in online cat sale scam (http://www.bbc.co.uk/news/uk-scotland-south-scotland-16283527)
• Fans warned about online ticket scam (http://www.bbc.co.uk/news/uk-northern-ireland-12682515)
• Christmas tree farm website revealed as scam (http://www.bbc.co.uk/news/uk-scotland-highlands-islands-20172672)

Hacking however is far more complicated than scamming. Instead of simply tricking you into parting with valuable bank, card and other such information they will hack into and steal it from your computer or the websites which you have given your information to (e.g. PayPal, eBay or Amazon). One way they are able to do this is by placing a keylogger (a program which tracks every key that is pressed) on the victim’s computer in order to steal passwords and other such information. This is commonly done by installing a keylogging Trojan via a virus or worm. However there are vast amounts of other ways in which computer hackers can acquire people’s information. The reason why all this information is so valuable is because online banking allows funds to be easily transferred by anybody with enough information (personal details of the account owner, card details, bank information, etc). For example if somebody were to find out a person’s PayPal information (email address and password) they could transfer hundreds or thousands of pounds to various different bank accounts.

Personal use of Online Banking -

Personally the only online banking service I use at the moment is PayPal. I use because it allows simple and easy money transfers to the majority of the larger online shopping sites such as Steam (a popular gaming service by a company named Valve) and Ebay (an online auctioning website). I use it to purchase various items and receive money from the online money making services I use, so far I have never been hacked or foolish enough to be tricked by a scam.