Adjust Text Size

Online Banking Explosion

Written by Nickel - Leave a Comment

According to the Pew Internet and American Life Project, 44% of American internet users (53 million people) now bank online. That’s one-quarter of all American adults! This represents an increase of 47% since 2002 and, of all online activities tracked by the Pew, online banking has grown the fastest. In terms of age structure, 60% of internet users between the ages of 28-39 bank online, making them (actually, us) the most likely to bank online. This isn’t all that surprising when you consider that people in this demographic (like me) are young enough to have fully embraced the internet, old enough to have a decent amount of money to manage, and are busy enough to need to do it online.

Beyond the convenience of accessing your brick and mortar accounts from home and paying your bills online, internet banks such as ING Direct and Emigrant Direct (as well as others) offer substantially better interest rates than are available in most (if not all) local banks (ING and Emigrant currently stand at 3% and 3.25% APY, respectively). In fact, I passed several banks on the way home today that were offering 12-18 month CDs for no more than these banks pay for completely liquid deposits. You’d be insane to lock your money up in such a deal when much better deals are just a mouse click away.

Of course, the growth of online banking hasn’t been all good — after all, without online banking there’d be a lot less phishing going on.

Published on May 1st, 2005 - Leave a Comment
Filed under: Banking, Online

About the author: Nickel is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!

Top Cards by Category

CASH BACK CREDIT CARD (see all)

Chase Freedom^® Visa - $200 Bonus Cash Back

Earn $200 Bonus Cash Back after you make $500 in purchases in your first 3 months. 5% Cash Back on up to $1,500 spent in bonus categories each quarter.

AIRLINE MILES / REWARDS POINTS CREDIT CARD (see all)

American Express^® Green Card - Introductory Annual Fee of $0 for the First Year!

Receive 10,000 Membership Rewards bonus points when you spend $500 in your first three months of card membership. Redeem bonus points for gift cards valued at $100. This is a charge card with no pre-set spending limit.

CREDIT CARD DEALS (see all)

American Express^® Gold Card

Receive 10,000 Membership Rewards bonus points when you spend $1,000 in 3 months of Card membership.

BALANCE TRANSFER CREDIT CARD (see all)

Discover^® More^® Card

Earn up to 5% cash back* in categories that change and enjoy a 0% introductory rate for 15 months on Balance Transfers and 15 months on Purchases.

LOW INTRODUCTORY RATE CREDIT CARD (see all)

Discover^® More Card - $0 Balance Transfer Fee!

Enjoy no balance transfer fee for a limited time. 0% introductory rate on Balance Transfers and Purchases. Earn up to 5% Cashback Bonus in categories that change like gas, restaurants, department stores and more. Limitations apply*

LOW INTEREST RATE CREDIT CARD (see all)

Discover^® More Card - $0 Balance Transfer Fee!

BUSINESS CREDIT CARD (see all)

The Business Platinum Card^® from American Express OPEN

Enjoy amenities for you and your business, like: complimentary airport club access, including American Airlines Admirals Club(R) lounges.

STUDENT CREDIT CARD (see all)

Discover^® Student Clear Card

5% Cashback Bonus in categories that change like gas, restaurants, department stores and more. Limitations apply*. Up to 1% unlimited Cashback Bonus on everything else. No annual fee

GAS REBATE CREDIT CARD (see all)