Is Online Banking Safe? Tips for Safe Money Management Online
According to a 2022 American Banking Association survey, most consumers prefer mobile (45%) and online banking (27%) over in-person branch visits (14%) … with the exception of Baby Boomers. Whether it’s because they lack technical know-how, distrust digital vs. in-person banking, or simply prefer a real person to impersonal interactions online, Baby Boomers prefer branch banking in person.
As financial institutions improve online banking, more and more services are being offered online, leaving the non-technically savvy folks feeling left behind and in the dark. Some people have concerns about managing their money, including making deposits without direct interaction with banking personnel. For those who are new to mobile banking or are uncertain about its safety, we’ve put together some tips to help you navigate.
Introduction to Online Banking
While most people have experience visiting a bank to open an account, deposit checks, or transfer money, today, you have the convenience of completing these transactions online through a bank’s mobile app or website. You can even pay your bills online. However, withdrawing funds from your bank still requires you to go to your bank, an ATM, or a store that allows cash back during checkout. Most banks and credit unions, large and small, offer some level of remote banking. Here’s a look at top banks that have brick-and-mortar and online presence and those that are online-only financial institutions. Our sources include Consumer Reports, Forbes, and The Motley Fool.
Just because a bank didn’t make the list doesn’t mean it isn’t trustworthy; in fact, many local banks offer excellent online experiences.
Best online banks and banking apps:
- Alliant Credit Union
- Quontic Bank
- Salem Five direct
- Varo Bank
Best brick-and-mortar with easy online banking:
- Bank of America
- BMO Harris
- Capital One
- Dollar Bank
- Frost Bank
- First Republic
- Regions Bank
- U.S. Bank
- Wells Fargo
Check Trustpilot for Banking Reviews
We at OneLaunch like to use Trustpilot for checking out business reviews, because they are user-generated reviews from real people. (Humble brag: OneLaunch’s Trustpilot score is 4.3 out of 5 stars. We read our reviews to learn from our users!)
You can use Trustpilot to check out reviews for banks and financial institutions. On the day we created this post, there were over 2,100 financial institution reviews. Use the filters to find bank reviews near you and by subcategories including banks and financial institutions.
Safety Tips for Online Banking
Reputable banks that provide online services have policies and technology in place to help protect you, your money, along the bank’s resources and capital. Some of the technology online financial institutions employ include website encryption, anti-virus protection, and fraud protection. However, it’s up to you to be a smart consumer who takes steps to keep your personal information and financial information out of the wrong hands.
Use strong, unique passwords
You may have heard this plea over and over, for a good reason. A weak password can open the door for hackers to steal your personal information, take over your accounts, or compromise your computer. A strong password should include:
- At least 12 characters
- A combination of letters, numbers, and symbols
- Upper and lowercase letters
Avoid using common sequences like 1234 or personal information such as your birth date, pet’s name, etc.
Other rules of thumb: Never share your password(s), change them regularly (every three to six months or so), and keep your passwords somewhere with limited access to others. A password manager can help you store and protect your passwords and login info.
Use two- or multifactor authentication
Enabling two- or multi-factor authentication adds another layer of security to your online accounts. Once you enter your user ID and password, you will also have to provide some form of verification like a PIN, your voice, or a text message. Ask your bank representative to show you how to set up two-factor authentication.
Avoid public Wi-Fi
Whenever you use a laptop or tablet while on the go, avoid using public Wi-Fi to do any online (or mobile) banking. If you have to use public Wi-Fi, only visit secure (https in their URL) or use a virtual private network (VPN).
Sign up for account alerts
Sign up to receive alerts (email and/or text) for account activity such as
- Credit and debit transactions
- Low or high balances
- Password changes
Avoid sharing personal or financial information via email or text
To protect your personal and financial information from potential phishing scams, verify the sender’s address (hover your mouse over the sender’s email address). Never share personal information in reply to an email or text from your bank. Instead, contact your banking institution to verify its authenticity.
Keep important banking documents in an encrypted file or in cloud storage (which is encrypted). Any paper documents should be kept in a fireproof key or combination safe or cabinet.
Safety Tips for Mobile Banking
One of the advantages of mobile banking is the ability to deposit checks wherever and whenever. However, in addition to practicing the above safety measures, there are a few extra precautions you should take with mobile banking.
Endorse your check(s)
Like depositing checks at your local branch, you must endorse the back of your check for mobile deposit. Under your signature write “For Mobile Deposit Only.” Some banks have a “For Deposit Only” checkbox that you can mark. This helps to ensure that no one can take your check and cash it.
Once endorsed, you’ll need to log into your bank account through the mobile banking app to take pictures of the front and the back of your check. Your banking app will guide you through the specific steps.
Hold onto your check(s)
After making a deposit, hang on to any check(s) you deposit via a mobile banking app until it clears, which could take several days.
Check your online or mobile bank account often
Instead of waiting for a monthly paper statement to review deposits and transactions, you can check your account regularly online and through a banking app. This can give you peace of mind and ensure you catch anything unusual right away.
Is Online Banking Safe?
For the most part, online and mobile banking can be a safe, convenient way to manage your finances. However, as in real life, it’s also up to you to protect your financial and personal information in the digital world. Do your homework and make sure that all safety precautions are taken on your end, through your devices, and when you access your account through an app or online.