What Is Net Banking? Features And Advantages Of Internet Banking
Banking services are evolving faster than ever in the digital age. In a country like India, where precious hours used to get wasted in long bank queues, digitisation of the banking ecosystem has been a boon. That is why it is especially important to embrace net banking or online banking.
With net banking, you can easily access your bank account online from anywhere in the world using your laptop or mobile device. With the online platform, shopping or transferring funds from one account to another and managing your bank account has become easier and hassle-free.
What is Net Banking?
Net banking, also referred to as internet or online banking, is a digital method of conducting banking transactions via the internet. It is an electronic system that anyone with a bank account can activate and use for financial transactions. Online banking provides customers with every service previously available only through a local branch, such as deposits, transfers, and online payments. Financial and banking institutions offer some form of online banking, both on desktop and through mobile apps.
Features of Net Banking
Internet banking has several advantageous features, which makes it essential in today’s digital world. Here are a few key features of net banking that are common across banking and financial institutions.
- Net banking provides 24×7 access to all banking services, including checking account balances and statements.
- Facilitates simple fund transfer and bill payment process.
- Customers can apply for insurance or loans through internet banking.
- Allows managing assets like fixed deposits.
- Provides a secure environment for a wide range of banking transactions.
- Customers can easily update their primary and secondary addresses.
- Customers can easily open an account, upgrade their debit/credit cards, and block them when necessary, using net banking.
- Net banking system is secure and safe. Only your unique ID and password will allow you to access the internet bank.
As a result, it is the quickest and safest mode of transacting online.
How to Apply for Net Banking?
You can sign up online for net banking through the official website of your respective bank.
- Go to your bank’s official internet banking website.
- Click the login button or the ‘New user/Register here’ link to log in.
- Fill the self-registration form, by entering your account number, mobile number, CIF number, debit card, and other details.
- Then enter the OTP sent to your registered mobile number to authenticate the process.
- Enter your temporary customer ID number and password.
- Sign in to make a more secure password.
Individuals who are unfamiliar with the fundamentals of internet banking can also access net banking services offline. You can submit the Application Form at your local branch, along with all the required documents, like copies of your bank passbook, Aadhaar card, etc. After verifying all the information, the bank will issue a customer ID and password for internet banking.
Advantages of Net Banking
Here are mentioned few advantages of net banking:
1. Single Platform for all Banking Services
Net banking allows users to access both financial and non-financial banking products/services from a single platform. You can open a fixed deposit account online, make payments to shoppers and merchants, order a cheque book online, buy insurance services online, set up online recurring payments and so on, with just one click.
2. Go Cashless
The ability to go cashless is an important feature of net banking. It allows you to direct or cancel automatic payments with a single click. You can transfer funds online at any time using NEFT, RTGS, or IMPS.
3. Convenience
A safe and convenient banking method. Instead of going to the bank to fill out your passbook entries and keep track of your transactions, mortgage payments, loans, savings accounts, and so on.
4. Availability
You can check your bank balance online at any time. Net banking allows you to pay your water, electricity, and other bills online quickly. You can also book tickets online and initiate transactions on a variety of e-commerce platforms.
5. Time-efficient
Internet banking allows you to complete any transaction in a matter of minutes. Net banking allows you to transfer funds to any account in the country or open a fixed deposit account in no time.
Also Read: NEFT vs RTGS: Which Is a Better Method For Transferring Money?
Disadvantages of Net Banking
There are some disadvantages of net banking. These include:
1. Interruptions in Technology and Services
Your ability to access accounts online will naturally be hampered if your internet service is slow or unavailable for an extended period. Similarly, if the bank’s servers fail or become temporarily unavailable because of scheduled site maintenance you cannot access any net banking services.
2. Difficult for Beginners
There are people in India who have lived their entire lives away from the internet. Inexperienced beginners will have a challenging time figuring it out on their own.
3. Transaction Security
Regardless of how many safeguards banks put in place to provide a secure network, online banking transactions continue to make account holders vulnerable to hackers lurking around.
4. Password Protection
Each net banking account requires a password to be entered to access the services. As a result, the password is critical to maintaining integrity. So, you should change your net banking passwords regularly to avoid theft of passwords. However, this can be difficult for account holders to keep a track of remembering all the time.
Types of Fund Transfers via Net Banking
1. National Electronic Fund Transfer (NEFT)
National Electronic Funds Transfer (NEFT) is a nationwide payment system that allows for one-to-one transfers of funds. Individuals, businesses, and corporations can electronically transfer funds from one bank branch to another in any participating country.
2. Gross Settlement in Real-Time (RTGS)
RTGS is defined as the continuous (real-time) settlement of individual funds transfers on an order-by-order basis (without netting). The RTGS system is designed primarily for high-value transactions. Transferring funds occurs on an immediate basis throughout India, and once completed, the transfer cannot be reversed.
3. Electronic Clearing House (ECS)
ECS is an alternative method for automatically debiting utility bill payments such as phone bills, electricity bills, insurance premia, card payments, loan repayments, etc. from your account.
4. Immediate Payment Service (IMPS)
IMPS provides an instant, round-the-clock interbank electronic fund transfer service via mobile phones. IMPS is a powerful tool for instantly transferring money between banks in India via mobile, internet, and ATM, which is not only secure but also cost-effective in both financial and non-financial terms.
Also Read: NEFT vs IMPS: A Detailed Comparison Between Payment Methods
Services Available Through Net Banking
- You can access your bank account from anywhere using net banking.
- You initiate online fund transfers using services such as NEFT, RTGS, and IMPS.
- You can access your account balance and previous transactions remotely at any time.
- Internet banking allows you to pay utility bills in the most convenient manner and recharge DTH and mobile services.
- Internet banking also includes the ability to invest and apply for loans.
- Open a fixed-income account.
- Order bank cards and cheque-book.
Final Word
Net banking is a banking service that allows customers to access banking services online rather than in person at the bank. You can easily access your online bank account from anywhere in the world using your laptop or mobile device and do shopping or transfer funds from your account to other entities in a matter of minutes.
FAQs on Net Banking
Ans: Any individual with a working bank account can be registered for net banking.
Ans: By entering your debit card information, you can activate your net banking account without visiting a bank branch. Users who do not have a debit or ATM card must visit their bank branch to complete their internet banking registration.
Ans: Yes, you can change your net-banking password at any time. It is recommended that users change their passwords at least once every two months.
Ans: When you apply for a new account, most banks provide you with an internet banking ID and password.
Ans:Ensure that you do not share your user ID and password, or the OTP to change the password with anyone.
Disclaimer
This article is solely for educational purposes. Navi doesn't take any responsibility for the information or claims made in the blog.
