What Is An Online Savings Account?

 If you’re researching online banking, you’ve come to right place. CANSTAR breaks down exactly what online banking is. 

What is online banking?

An online banking account is any savings and/or transaction account that allows you to perform your banking activities online via the internet. It can be done via an online banking system, such as PayPal, or through your registered bank.

What is an online savings account?

An online savings account is a savings account where you manage your funds using the internet and earn interest on the balance. Many online savings accounts are “online only”, meaning you can’t make ATM withdrawals directly from the account. However, a growing number of online accounts are combined savings and transaction accounts, where you can make online and in person transactions using the account.

A combined online transactions and savings account can work out cheaper for those who make a lot of transactions in and out of the account. Earning interest adds value for someone who doesn’t want the fuss of transferring money in and out of a separate savings account.

According to the Canstar Blue 2015 banking survey of more than 3,500 Australian adults, online banking is now used by a staggering 90% of Australian customers. We were impressed to see how many seniors are getting online to do their banking.

online banking users 97% of Gen Yers aged 18-24 young adults use online banking.
91% of Gen Xers aged 40-49 use online banking.
89% of Baby Boomers aged 50-59 use online banking.
86% of Baby Boomers aged 60 and over use online banking.
76% of Seniors aged 70 and over who have internet access use online

Source: Canstar Blue

Common features of online savings accounts

There are a few basic things you should be able to do using online banking or an online savings account:

Internet banking functions accessible in a browser:

  • Secure application process including ID verification
  • Secure log-in process
  • Make a wide range of transactions and payments
  • Create reports or e-statements for your account
  • Easy to use self-service menu
  • Use self-help education and tools as needed
  • Contact banking institution using online or email customer service
  • Find your nearest ATM or branch using online location services

Mobile banking functions accessible in an app:

  • Make transactions and payments
  • Make contactless payments in person using phone app instead of card
  • Get account information
  • Transfer money between your accounts
  • Access your transaction history
  • Calculators for home loan repayments, currency conversion, and share trading
  • Contact form through app
  • Apply for other banking products through the app
  • Find your nearest ATM using app location services

Common fees charged on online savings accounts

A combined online savings and transaction account may well have some fees because of the ability to make many transactions. Some of the more common fees may include:

  • Monthly account-keeping fees
  • EFTPOS transaction fees
  • Electronic transaction fees such as BPAY fee
  • Branch cash deposit or withdrawal fees
  • ATM withdrawal fees from your own bank and other banks
  • Cheque deposit and withdrawal fees

Compare online banking with CANSTAR

In this technological era, online banking seems to be the way to go for many consumers. However in saying that, like any other service, it’s important to do your research when it comes to making a purchase decision. We here at CANSTAR have compared over 50 online banking providers and put them in one easy-to-use comparison table for you to use.

 

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