The Pros and Cons of Online Banking

Online Banking - Complete Controller

Because most people opt for convenience and use electronic transactions for banking, even with traditional banks, many opt to ditch brick and mortar banks and choose to use online banking. If you are considering online banking, here are the pros and cons of online banking to make an educated decision on whether it is right for you and your banking needs.

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Higher Interest Rates

Because online banking institutions have a lower overhead to operate, they can benefit their users. One way they offer this advantage is through interest rates. Not only do they offer interest on balances on both checking and savings accounts, but the interest rates are higher than those carried on traditional bank accounts and only on savings accounts. Most brick and mortar banks offer rates ranging from 0.10% to 0.50%. On average, looking at online checking and savings accounts, they offer higher rates of 0.9% to 1%. Though this difference is slight, it does add up big when you consider it is offered on both checking and savings accounts.

Fewer Fees

For the same reasons, online banks can offer higher interest rates to offer lower to zero fees. Online banks are looking to attract your business, so their low overhead helps them use the savings to benefit (and attract) customers.

Online banks will also often cover ATM fees, regardless of where in the world you make withdrawals. Double-check the coverage of ATM fees as some banks will only offer coverage on a certain amount of transactions per a certain period.


Unlike brick-and-mortar banks, online banks are open 24/7; however, most traditional banks offer electronic banking options similar to online banking, making some transactions similar other than the possibility of fees. Check out America's Best Bookkeepers

Your bank is also available anywhere you have the internet or phone service using mobile apps, which means you can do banking transactions from anywhere in the world. The convenience and 24/7 access could be the most significant reason online banking is the way to go for someone on the move or odd hours to do their banking.


Many believe that banking online is less safe than in-person banking at a brick and mortar bank. Online banks have a high security and site encryption level that ensures that all online transactions are safe. Though this is the case, you should endure choosing an online bank covered by FDIC like a brick and mortar. This will give the assurance that your money up to $250,000 is covered against any theft or fraud online.

Cons of Online Banks

Deposits Can Be a Hassle

While online banks and even current traditional brick-and-mortar banks offer e-deposits for checks and direct deposit for paychecks, there is one difference between them: cash deposits. If you are given cash that needs to be deposited, you will not be able to do that with an online bank at all.

The only choice you will have is to take the cash and purchase a money card to use it online, which will cost a fee. Or you can use the cash to make purchases, which could be inconvenient if you are making online payments or purchases. Check out America's Best Bookkeepers

Less Personalized Service

Some people, especially older bank customers, like the personal touch given when they do their banking in person at a traditional bank. At the same time, this is understandable and could be considered a con by some. Generally, the convenience and low to no fees make up for this impersonal approach to banking.

Technological Challenges

If you are not used to banking in the virtual environment, it can take some time to adjust. Online banking website designers try to make navigation as easy as possible for their customers, but some customers may never get used to online banking. This could be compounded if your online banking institution changes the site or does upgrades that you use to change features.


There are definite pros and cons to online banking. Once you have considered all the options, you may opt to ditch traditional banking institutions and move to online banking. Use the information you learned here to decide if online banking is right for you.

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers