We are often asked about telephone and electronic banking. This DataSheet will try to summarise some of our thoughts on the subject.
Physical and Visual Impairment
These services are often said to benefit the elderly and less able - we can only report the problems and attitudes we have encountered: Braille and wheelchair-level cash machines are very infrequent in the high street.
Telephone banks can be used from home, but so far there is no way to obtain cash by phone.
Local branches are easy to park near, and staff can be helpful to the infirm, and their layout is normally simple and easy to remember.
Big City branches are often very difficult to park near, staff are normally very busy, and the layout is big and confusing - and can change with new promotions and advertising.
Public car parks, as available in the big cities are often not equipped to deal easily with special access or visually impaired problems.
If telephone and electronic banking therefore means fewer local branches and less personal service, this seems to be a bad thing.
Less local access eventually means that anyone unable to cope with large busy branches is going to have to stay at home for most of their banking services, and possibly rely on someone else to get cash if and when necessary.
Security
Whether you have a dial-tone system where you bleep answers to computer questions, a voice recognition system where you speak your answers to the computer, a live operator who asks you questions and types responses into a database, or a keyboard system where you type in the details yourself; all rely on your providing information about yourself to confirm that you are who you say you are.
(We have a separate DataSheet about security issues.)
In this general description of services, we will comment only that whatever your means of access, someone else who is familiar with your system - a work mate, a friend, anyone who can see and hear you access your system on several occasions - can collect enough information to beat your security.
If you lose money through what turns out to be your lack of care, you may have trouble recovering it.
Be Careful - if you use hotel or office telephone systems which include call logging which identifies which numbers are dialled from which extensions.
Some of these systems can record the telephone number AND the account number AND the access codes you use to get into your system.
Another security aspect is the good old eggs in one basket factor; if all your funds are dealt with by computer, what happens when the computer goes down for a while?
Viruses, hacking and simple equipment failure do still happen..
Cost
It is noticeable that most of the electronic banking systems which have been introduced so far involve substantial savings for the banks - fewer branches, less staff, less documentation, less fraud risk, less security because bulk cash is not being handled locally.
Agreed there has been major expenditure in developing new computer systems - but only comparable to developing a new model of car, which has to compete in the open market at the same price as all other new cars.
Motor manufacturers also do not have the luxury of economies like cutting a branch structure to offset their costs.
It is also a point that most computer banking systems require YOU to do all the work - you instruct the computer to transfer money, which if it is available to you, the computer will do.
If there is a mistake (which is likely unless you are very familiar with the software and banking arrangements) YOU will be responsible.
So why do all the current electronic systems cost more than conventional banking?
As a matter of interest cheque clearances - or at least the transfer of incoming credits to your account balance - also still seem to take four days: i.e. if the credit is received on Monday you will not be able to draw cash against that credit until the following Thursday at the earliest.
There was always an argument that because of the Bills of Exchange Act 1896, which required the issuing bank to actually see a cheque before it could release the funds to the recipient, there was a complicated process to go through before the cheque got back to the issuing bank and funds were released.
If you are sitting at your computer paying and receiving monies by electronic transfer why is there still a delay? - The bank of course will have access to your funds to earn money by overnight investment..
Our attitude to Electronic banking is that as part of an overall range of banking products including local counter services, some customers will find it worthwhile.
We do urge everyone to consider the cost of this luxury access to money, and the long term effect of too quick a transfer to non-human banking. There are already pressure groups in certain areas of the UK campaigning to bring back local banking services to their high street....
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