The technology has helped banks to improve its services and even offer some on a 24 hour basis thanks to the availability of account information, transfer of funds, bill payments and account management services that customers can access online by logging into the their personal page on their bank's website. Customers need a personal and confidential password to log in to the website just like the personal identification number used at the automatic teller machine.

Internet banking has been a welcome option for many customers but quite a number of sceptical customers still prefer to do it the old way. This group comprises those who may not be too comfortable with computers nor with the internet. It has certainly improved the pace at which business is transacted.

Gone are the days when you had no chance of paying that late bill in time because you remembered it when the bank was already closed, you can always get home and pay it electronically. And sending money to a friend or child in need no longer needs to be expensive and time consuming. And we can save the paper and sign less checks or none at all.

It is the growing number of virtual banks that are threatening traditional banks as we know them. Virtual banks offer most if not all their services online and are therefore able to offer customers no charge transactions and higher interest rates. ING and HSBC are good examples of virtual banks.

ING started its operations in Europe and is now established in North America. It is able to offer customers no account fees savings accounts at a higher rate than regular banks, there is no charge either for withdrawals at certain levels. ING also offers very competitive mortgage rates with many flexible options that traditional banks are just catching up to. And most of the services can be done online and completed by phone or by one time paper work.

Although internet banking is a welcome option that makes the lives of customers easier and improves business efficiency, it faces a negative aspect in terms of the chances of fraud. Electronic fraud occurs when criminals get hold of an account holder's details and log in names or password and use their account or move money from the account.

They may do this by hacking which is a way of illegally surpassing a website's security barriers to gain access to confidential information, or they may do so through phishing. Phishing is a practice whereby an account holder receives an email purporting to come from their bank asking them to confirm their bank details like names and passwords. They then use these details to access their accounts.

Sometimes confidential information falls on the wrong hands due to client carelessness; this is something banks cannot control. Banks try to use the latest security technology available to protect their clients.