Most services suffer from disadvantages, and on-line banking is no exception. Recently, there have been a number of technical incidents, where customer information was disclosed to other users. Banks have been quick to react, and have either reverted back to the previous system or have solved the problem immediately.

The main disadvantages are those related to fear of the unknown. The main fear is that transferring money electronically will somehow cause it to disappear into the electronic abyss. Banks are aware of this concern and do assure account holders that such an event should not occur. There is some speculation, currently, that Internet-only banks will not be able to sustain their high interest rates.

Other drawbacks to using Internet-only banks include:

• Penalties for phone transactions;
• Access to cash (ensure that there is sufficient access to ATMs).

 

We may perceive this method of banking to be instantaneous. For example, when a bill is paid, the expectation is that the transaction is completed with immediate effect. However, this is not the case, as the systems are still connected to the UK clearing system, which takes three working days to clear payments.