Mobile banking vs online banking review

9 August 2017

Financial institutions have been working for years to make banking more accessible and convenient for their customers. It started with ATMs, then with online banking, and now mobile banking. While online banking has been around for quite a few years compared to mobile banking, many people assume that they refer to the same thing – the two are closely related, but which one comes out on top? What is easier to use? Which is more secure? In this article piece, we would like to showcase the key differences between Internet banking and mobile banking, take a read.

Comparison chart

Basis for comparison Mobile banking Online banking
 

 

 

Device

Mobile banking is a service that enables the customer to perform banking transactions using a cellular device (mobiles or tablets). Online banking is nothing but a banking transaction, carried out over the Internet, via respective bank or financial institution’s website, under a personal profile, with a personal computer or laptop.
 

Use

 

It uses short message service, mobile apps or the web. Online banking uses bank’s website.
Fund transfer Fund transfer is possible with the help of IMPS (Immediate Payment Service), NEFT (National Electronics Funds Transfer System) or RTGS (Real Time Gross Settlement). Funds can be transferred from one bank or branch to another, with the help of NEFT (National Electronics Funds Transfer System) or RTGS (Real Time Gross Settlement).
Functions Typically limited functions Typically more functions
Download The banking application needs to be downloaded onto the phone No download required
Internet Requires access to Internet, either through Wi-Fi or data Requires access to Internet, typically though Wi-Fi or wired connection.
Access 24 x 7 24 x 7

 

Mobile banking

Mobile banking is just starting to arrive as an option to handle your finances. By using just a few clicks of your smartphone and remembering some secret data to access your accounts, you can transfer money in a flash. Transactions that take place through mobile banking includes online payment of bills, locating an ATM, fund transfer, monitoring account balances, the list of latest transactions, m-commerce, mobile/DTH top-up, etc.

Mobile banking

The pros of mobile banking

Mobile banking has plenty of benefits, which is why it eventually took over online banking as the number one way to manage money.

Interactive Voice Response (IVR).  It is the automated system you find when dialing the bank’s phone number. You can press a certain prompt for the option you want, and it navigates the menu to arrive at the final page.

Time saving. Instead of allocating time to walk into a bank, you can check account balances, schedule and receive payments, transfer money and organize your accounts when you are on the go.

Convenient. Do your banking at a time and place that suits you, instead of waiting in queues. In addition, mobile banking uses the network of service provider and it does not need Internet connection.

No fees. Mobile banking service offered by almost all banks is free. This means that the customer can handle hassle-free transactions without extra charges.

Secure. Generally, good mobile banking apps have a security guarantee or send you an SMS verification code you need to input to authorize a payment for added security.

Risks of mobile banking

If banking through your mobile sounds like something you might be interested in, you will want to know everything about it – risks and so on. This can help you to weigh up whether you want to continue banking in person, on your computer, or whether you would like to begin using your mobile.

Security threats. One of the great threat to mobile banking is “phishing”. In this case users receive fake message asking for their bank details. In addition, if the mobile gets stolen, the information stored in messages can be used easily by another person.

Not available on all mobile phones. Sometimes it requires you to install apps on your phone to use the mobile banking feature, which is available on high-end smartphones. If you do not have a smartphone than the use of mobile banking becomes limited.

Non-encrypted servers. This makes it relatively very easy for an expert hacker to obtain account information or debit and credit card data of the users.

Online banking

Online banking or otherwise known as Internet banking is among the convenient e-banking modes, which makes difference in banking operations and provides virtual banking facilities to its customers continuously.

Put simply, online banking is an electronic payment system, that allows the bank account holder to execute the monetary transaction, such as bill payments, fund transfer, stop payment, balance enquiries, etc. anytime and anywhere using the bank’s website. Online banking is part and parcel of the core banking system handled by the bank.

Online banking

Benefits of online banking

Effectiveness: Many online banking sites offer sophisticated tools, including account aggregation, stock quotes, rate alerts and portfolio managing programs to help you manage all of your assets more effectively. You get a full package of services and not an abridged version for mobile.

Real time statements. Rather than waiting a month for a printed statement, online banking provides you the opportunity to see a history of your transactions instantly and track your activity, according to the online Money Instructor.

Drawbacks of online banking

Admittedly, there is not too much downside to online banking, but there are a few things that many customers would change if they could.

Banking site changes. Even the largest banks periodically upgrade their online programs, adding new features in unfamiliar places. In some cases, you may have to re-enter account information.

Security. Some systems can have viruses and key loggers, which can steal passwords and other sensitive information.

Transaction speed. Not always as quick or convenient as mobile.

Mobile and online banking provides convenience to customers who want to manage their finances while on the go. While your choice will depend on your lifestyle, there are more benefits to banking using your mobile. Not only is it quick and easy to use, but you can also have peace of mind that your details are secure with the right app. In contrast, the scope of Internet banking is relatively higher than that of mobile banking, because the latter is a part of the former. All in all, consider the device you own, speak with your financial institution’s representative, and figure out which option works best for you.

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