How has online banking affected society?

Online banking, or the ability to manage bank transactions over the Internet, provides services today that many depend on. However, the ability manage banking from a home computer is fewer than 10 years old. This practice has fundamentally changed personal money management in a very short time period.


Prior to Internet access to bank accounts, most people visited their local bank to manage their deposited funds. Eventually, phone services developed in the 1980s and 1990s to perform the same tasks remotely, and automated teller machines provided some level of 24/7 access for deposits, transfers and withdrawals.

Online Banking Introduced

Online banking started in 1981 and became widespread in the 1990s. In the beginning, account access was the only service provided. Customers could balance their checkbook daily and at any time of the day. This allowed consumers faster access to money positions and faster transfer of funds.


Many today would likely find it very difficult to go back to paper banking. Daily data updates make it easy to monitor transactions and fraud risk. And with automatic bill payment, many consumers don't mail bill payments anymore. Finally, being able to download years of bank statements makes it easier to maintain consumer records. Banks have also streamlined staff and branches, reducing operating costs. Some banks operate entirely on the Internet with very few physical branches.

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About the Author

Since 2009 Tom Lutzenberger has written for various websites, covering topics ranging from finance to automotive history. Lutzenberger works in public finance and policy and consults on a variety of analytical services. His education includes a Bachelor of Arts in English and political science from Saint Mary's College and a Master of Business Administration in finance and marketing from California State University, Sacramento.

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