What is an online banking? Benefits, services, and considerations when using this transaction method

Electronic banking is a type of service that allows users to check personal information and perform transactions via the internet without going to a physical bank. The emergence of electronic banking has opened up a new phase in the banking experience of Vietnamese people. Currently, all banks in Vietnam are making efforts to provide electronic banking services to optimize the customer experience.

What is Electronic Banking?

Electronic banking (E-banking) is an online banking service that allows customers to access and manage their bank accounts via the internet.

All of these actions are performed through smart devices connected to the internet such as laptops, phones, tablets, etc. Users do not need to go directly to ATMs, trading floors, or banks to perform these commands.

Electronic banking transactions are secured by an OTP authentication code. This code will be sent to the user’s registered phone number. Electronic banking allows users to use banking services anytime, anywhere.

Customers can perform various types of transactions such as:

• Update and check balance information, accounts, transaction history, etc.
• Transfer money between banks or within the same bank.
• Pay online utility bills, shop, top up mobile phones, buy train tickets, plane tickets, etc.
• Open and close online savings accounts.
• Pay taxes online.

Services of Electronic Banking

Internet Banking

Definition: Internet Banking is an online banking service performed on mobile phones, laptops, tablets, etc. through an internet connection.

Features: Provides users with most basic services such as checking available balances, transferring money, paying bills online, etc.

Registration method: There are 3 ways to register:

• Register after opening a payment card: Immediately after opening a card at the bank, the staff will advise on this service and guide you to fill out the registration form according to the policy of each bank.
• Direct registration at the bank where the card was opened: The quick way to register for Internet Banking is to go to the nearest bank for advice and support in registration.
• Online registration: This method is currently only used by some banks. At the same time, Internet Banking is only applicable to those who already have a bank account.

How to use:

• Step 1: Log in to the bank’s website.
• Step 2: Select Digital Banking section.
• Step 3: Log in to the previously created E-Banking account.
• Step 4: Select the service to use.

Mobile Banking

Definition: This is an online service through a mobile application, just need to download the bank’s application to your phone. Depending on the characteristics of the device, the application provides users with security features such as Face ID/fingerprint and QR code payment.

Features: Mobile Banking has similar features to Internet Banking, including fund transfers, online savings deposits, bill payments, etc.

Registration method: There are 2 ways to register for Mobile Banking:

• Register at the bank.
• Register from the bank’s website.

How to use:

• Step 1: Open the bank application on your phone.
• Step 2: Log in with a password, fingerprint, or Face ID.
• Step 3: Choose the features you want to use such as fund transfers, online savings deposits, etc.

SMS Banking

Definition: It is a banking service that provides information via text messages.

Features: The main feature is account balance reporting. In addition, you can also use other utilities by composing messages according to the sample syntax.

Registration method: There are 4 ways to register for SMS Banking:

• Register directly at the bank where you open the card.
• Register online through the bank’s website or application.
• Register via SMS using the sample syntax of each bank.
• Register at ATMs.

How to use: Once you have registered for SMS Banking service, you can use features such as balance inquiry, transaction notifications, exchange rate search, etc.

Phone Banking

Definition: This is a banking service that allows you to check your account balance and perform transactions using the bank’s fixed phone number.

Features: Common features such as balance inquiry, fund transfers, payments, transaction statements, etc.

Registration method: 

• Step 1: In the Settings section on your bank’s website, select Phone Banking Service Registration.
• Step 2: Your personal information will be displayed on the screen. After verifying the accurate information, confirm that you understand and agree to the bank’s terms and conditions.
• Step 3: Check the information carefully and confirm the transaction.
• Step 4: Authenticate with an OTP code to complete the service registration.

How to use: After registration, you can log in with the access code and password sent to your registered email.

• 4 ways to withdraw cash without an ATM card

Benefits of Electronic Banking

For users

Electronic banking provides convenient conditions for customers to perform transactions anytime, anywhere through the internet. Wherever you are, just register for the service and have a device connected to the internet, you can enjoy all banking services with many benefits such as:

• Quick and easy money transfers: With just a few steps, transactions such as money transfers, checking accounts can be done anywhere. Transactions can be completed in minutes, even on holidays and weekends.
• Easy online bill payment: Electronic banking allows customers to manage their accounts and make quick online bill payments such as internet bills, electricity bills, etc. You can also pay insurance fees, interest rates, securities investments, etc.
• Checking account balances: Electronic banking allows you to manage personal account information such as tracking balances, loans, savings, and printing regular transaction reports. In addition, customers can inquire about exchange rates, fees, interest rates, etc.
• Sending online savings deposits: You can deposit and withdraw savings anywhere. You can create multiple online savings accounts and withdraw money without going through complicated procedures.
• Electronic banking also allows you to invest and purchase insurance online.

For businesses

Businesses/organizations using electronic banking bring benefits such as:

• Accelerating financial transactions.
• Monitoring and controlling cash flows accurately.
• Calculating incoming and outgoing cash flows in the company accurately and transparently.
• The secure security system makes customers, businesses, and organizations feel safe during transactions.
• Reducing unnecessary transaction-related costs for companies and organizations.
• Saving time for accounting to perform transactions.

For banks

The benefits of banks having electronic banking are:

• Banks can expand their operations thanks to the coverage of the Internet. This helps the bank reach more customers.
• Saving a certain amount of money such as physical facilities, premises, personnel for bank branches. From there, the bank’s income increases.
• Higher efficiency in the use of bank funds when customer income and expenditure activities take place quickly.

Differentiating Electronic Banking from Digital Banking

Many people often confuse E-banking and Digital Banking. However, these two forms have similarities and differences as follows:

• Both forms can make online payments and transactions. Customers can use them to pay bills and transact on e-commerce sites.

The difference between these two forms of banking:

Digital Banking:

• Digital banking has a wider and more comprehensive scope than E-banking.
• Digital banking has all the features of a real bank, including loans, personal loans, withdrawals and transfers to accounts, payment account management, card management, participation in investments and insurance products, personal and business financial management.
• Digital Banking is safer and closely monitored by banks.

E-banking:

• It only reflects a part of the digitization aspect of the banking industry.
• E-Banking is a service aimed at complementing traditional banking services and focuses on basic features such as money transfers, online bill payments, balance checks, deposits, etc.

Notes when using electronic banking

Along with the benefits of technology development, it also means that many individuals are taking advantage of it to perform malicious acts such as extortion, fraud, etc. Therefore, when using electronic banking, you should note the following: 

• Do not share passwords, personal information, OTP codes, PIN codes used to access and perform electronic banking transactions in any form with anyone.
• To avoid having your information stolen, avoid accessing unreliable links and websites.
• To prevent others from accessing your account, do not log in or save login information on any public web browser or mobile device.
• Avoid using software, utilities of unknown origin to avoid information theft.

Conclusion

In the above article, FPT Shop has explained what electronic banking is and the services and accompanying applications of this application. The digitization of banks has improved services and enhanced the user experience.