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Online banking clicks with consumers

By Helen Huntley, Times Personal Finance Editor
In print: Sunday, May 25, 2008

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Ask Pat Johnson about online banking and you find one very satisfied customer.

"I love the convenience," she said. "If my personal account gets too low, I just click and transfer funds from savings. If I want to put more into savings, it's just as easy."

Johnson, who is 65 and lives in Trinity, says she especially likes the fact that transactions show up in her account immediately. "Being online takes the guesswork out of banking," she said. "It has kept me from making errors in addition or subtraction and being overdrawn. I know daily where I stand."

Enthusiastic users like Johnson are a big reason online banking is expected to cross a major threshold this year. Forrester Research projects that for the first time, a majority of U.S. households will be banking online. Five years ago only 24 percent were.

That torrid pace of growth is expected to slow a bit, then pick up steam as more of the young people in Generation Y get adult bank accounts. At a recent online banking conference in St. Petersburg, one of the hot topics was banking by cell phone. That particularly appeals to young adults, reported Shelby Hutcherson, a vice president with Synovus Bank, which has been testing mobile banking in some markets. She said customers mostly use it to check their balances on Friday to see how much money they have for the weekend and again on Monday to see how much they have left.

Most people who bank through Web sites transfer money and pay bills in addition to checking balances. Tower Group estimates there will be 3.5-trillion online banking transactions this year.

Although seniors have the lowest adoption rate for online banking, in the Tampa Bay area retirees are among its biggest fans. A recent question about online banking experiences attracted comments like these:

"I love online banking," said Bill Murphy, 64, of Sun City. "The only time I go to the bank is to get cash at the ATM."

"I use it for 100 percent of my financial transactions," said Bob Lartz, 71, of St. Petersburg. "I even have my 93-year-old mother on board."

Many users like the cost savings, which increase every time the U.S. Postal Service raises the price of stamp.

Security concerns have made some people shy away from banking online.

"If big companies have problems with people hacking on their computers, what chance does my personal computer have of being secure?" asked Kimberly Cooper, 51, of St. Petersburg.

But those who bank online say good antivirus software and vigilance can keep your money safe. Paper checks may be more of a security risk since anyone who gets a check has your bank account number and can easily print a counterfeit check.

"Check your balance often" is Pat Johnson's advice. "That way, if someone does hack into your bank, anywhere you shop or your personal account, you would be aware and be able to take immediate action."