Guide to savings accounts

9. Online savers

Banking online has become a way of life for many probably because of the convenience it offers. At the same time it is safe, easy to use and means you don’t get bogged down by paper statements every month.

Banks offer online services because they too reap the benefits. If banking is done online, firstly there will be fewer staff to pay. On top of this, there will be fewer overheads because they don’t need to have as many branches open for their staff to work in. Additionally, they don’t have to send out statements each month which also saves on staff and overheads.

As a result of these reduced costs, banks can generally offer higher interest rates on online savers (also known as ‘esavers’).

Internet banking involves visiting the banks website and clicking on the ‘Login to internet banking’ button. Here you will need to enter your unique internet banking ID and your password information. Banks will give this to you when you set up your internet banking.

An online saver has to be opened online and most queries will have to be addressed online.
 

The advantages that come with having an online saver are:

• Higher interest rates

• Easier access to your account details and statements – view them online 24/7 and print as and when required

• No need to go to the cashpoint to see if you have money; check from the comfort of your desk

• Instant transfers between accounts held with the same bank

• Arrange transfers to accounts held in other banks

• No more queuing in busy banks at lunch time to deposit/withdraw funds
 

The disadvantages of having an online saver are:

• Getting used to internet banking can take a while but ‘help’ sections usually ease the process

• Login details are sometimes hard to remember because security is tougher than just entering in a four digit PIN number (never keep your internet banking ID written down with your internet banking passwords – treat these like you would your PIN number; don’t tell anyone these details and tell the bank if you think someone else has gained access to them)

• The increased access could mean that you will be tempted to dip into your savings more

• Some banks stipulate that in order to have an online saver, you must also have a current account with them

• A lot of your queries will have to be addressed online so if you prefer dealing with problems face-to-face, these accounts will probably not suit you best

 

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• Next page: Individual savings accounts (ISAs)
• Previous page: Instant access savings accounts
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Guide contents

1. What is a savings account?
2. Savings accounts and interest rates
3. Tax and UK savings accounts
4. Opening a savings account
5. Adding money to a savings account
6. Accessing money in a savings account
7. Regular savings accounts
8. Instant access savings accounts
9. Online savers
10. Individual savings accounts (ISAs)
11. Helpful links for further savings information

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