Are you comfortable with online banking?
Recently, on the Alberta Primetime Money Panel, I was asked how comfortable Albertans and Canadians were with online banking. Personally, I am very comfortable with technology and online banking. I think cell phones and tablets and faster internet have made it easier than ever for people to manage their finances online or through some forms of tech gadgets.
Informally, I poll people in my workshops about online banking and 75% of the people bank electronically. The younger the person, the more likely they are to do some online banking. But I wanted to go beyond my experience and informal polling so I thought I would start a formal poll and share some data from a few different sources.
Canadians are still concerned about the risks of online banking
I remember 15 years ago, there was a lot of concern over the security of online banking from my clients and the general public. Today, those same concerns exist. An Ipsos Reid study says that 83% of people who bank online are still concerned about identity theft and security.
According to Statistics Canada, Canadians who had used the Internet for five or more years were less likely to be concerned about online security than those with fewer years of an online experience. Of those who reported using the Internet for less than five years,55% were very concerned about online credit card use and50% about banking over the Internet.
Online use by Canadians is growing
Canadians say the most significant change in banking habits over the past five years has been adopting online banking. According to a study by the Canadian Bankers Association (CBA), “Online banking continues to be the fastest growing and most popular method of conducting banking transactions.”
The majority of Canadians (63 percent) report using online banking in the last year and nearly half of Canadians (45 percent) today use the Internet as their main means of banking (up from only eight percent 10 years ago).
Although these concerns exist, it appears convenience has overcome people’s fears because online banking usage continues to grow.
82 percent of Canadians say technology has made banking more convenient. 44 percent say they value the ability to access their accounts anywhere; 15 percent value the ability to bank when it is convenient for them; and 25 percent say they do less running around which saves time and money.
What do people use online services?
Although people can do a lot online in terms of managing money, here are some of the most popular things people do online financially:
- Checking account balances
- Paying bills
- Managing Investment accounts
- Transferring funds
- And, one of the growing online uses in the financial industry is applying for credit cards, mortgages and investment accounts.
The majority of Canadians who visit their banks’ websites say they check their account balances (92 percent), pay bills (85 percent) and transfer funds (76 percent).
Mobile banking and purchases
Mobile banking is still in its infancy with only 5 percent of Canadians reported using mobile banking during the last year. According to a survey by KPMG, only 19 percent of Canadians feel comfortable using their mobile phone for financial transactions.
The same survey found that just 8 percent of Canadians had made a purchase using a mobile phone which is significantly less than global consumers at 28 percent. Interestingly, in China, 77 percent of respondents say they have used their mobiles for banking and 44 percent for retail transactions, while in India 38 percent are using them to shop and 43 percent for financial business.
This sector of banking should continue to grow as cell phone and tablet technology continues to improve. Consumer concerns over privacy and security are also pivotal to the continued adoption of e-commerce and mobile commerce.
The infographic on the growth of mobile banking was provided by Techvibes
Safety and security
You can’t talk about online financial resources without talking about security and safety. Since 1996 banks have spent more than $56 billion to ensure the Canadian banking system is accessible, convenient and secure.
The most common activities for ensuring the safety and security of online transactions are PIN protection, use of secure websites and checking bank statements.
More than nine-in-ten (93 percent) report the use of anti-virus software, while more than eight-in-ten (85 percent) use firewalls. 78 percent of Canadians use anti-spyware.
For more information on online safety tips, check out these resources
- CIBC’s website
- Investor Education Fund