Choosing an online current account

Banking over the Internet has transformed the way many people deal with their personal finances. Online current accounts mean people have access to their cash 24 hours a day, seven days a week, 365 days a year. They can also move money around and pay bills however they choose. All this means people are potentially more in touch and in control with their money than ever before. But the virtual high street is now as competitive as the one in the real world, and it can be difficult to know which bank to choose.

Applying for online current accounts is done in much the same way as regular banking. If you have a current account with an offline bank the chances are they will already be able to offer you Internet banking free of charge. Some banks exist only on the internet, or are internet versions of big high street names.

Running an account online has posed security questions, and fraudsters have attempted to break into people’s accounts by sending them emails pretending to be from their bank. This is sometimes known as phishing - remember your bank will never send you and email asking you to confirm your security details. If you get one like this, the general advice is to ignore it, or contact your bank via phone if you are unsure about its authenticity. Banks also keep records of the various ways people try to commit fraud, so reporting phishing is important for prevention.

Banks will provide various ways of protecting online current accounts. Your security is also their security, so you will normally be provided with a unique serial number or user name and password. This is normally just one level of protection, and an account can also involve second passwords with drop down menus so you can select the characters rather than type them. Some providers even supply code generators to customers, which someone uses to get a digit based password, which must match up with the one active on the account at that time.

One of the main benefits of online accounts is that firms have found running a bank over the Internet can reduce costs. Its usability and smoothness means customers can do many things they would previously have had to go to a branch or ring a phone line for. This means banks have tried to tempt customers with attractive initial interest rates.

Not only can you see an up to date version of your bank statement, potentially eliminating the need for paperwork, online current accounts can offer many extras including text message updates and even SMS warnings when you are about to go over your overdraft limit. Some will issue a charge for this rather than providing it for free, and people who like to be as in touch as possible with their finances might want to check what is included with each potential package. Once it is set up however, a bank account online can reduce the need to join frustrating queues at the branch, and waiting on the end of the phone listening to a banal hold tone can also become a thing of the past.