Internet Bank

An analysis of the explosion in internet banking facilities in the UK.

In three years, use of internet bank accounts has increased ten-fold, as services become accessible to ordinary people and not just tech-savvy computer nerds. Simplicity, convenience and the wealth of online-only deals and offers are all reasons we’re parking the car and going online to bank.

The development of internet bank accounts and online banking has been startling. In 1995 there were no online banks. The number of personal accounts accessed by computer increased by nearly 50 per cent in 2002 to almost 13 million, a ten-fold increase on the number just three years before.

There are several good reasons for this. Firstly, there is a totally new breed of internet bank- operations not tied to the existing banks (although many are now operated by large banking organisations); these have offered completely new bank accounts and services you couldn’t get before. This has attracted entirely new customers to banking and improved customer choice for existing customers.

Secondly, more people are hooked up to the internet than ever before- this ties in with better security and evaluation of security for internet bank operations. We now feel relatively safe passing credit card details and accessing our private accounts online.

Thirdly, even where internet bank accounts are just an extension of high street accounts, we’re beginning to appreciate the convenience and reduced cost of banking online (even it just means not paying for parking in our high streets- where trade is rapidly dwindling in all retail sectors). In the next five years, expect online banking to improve further, so that the full range of banking products (and even face-to-face meetings with your manager) can happen in the online environment.