Happy National Online Banking Day! Six Fascinating Facts About Online Banking
It’s October 9th and we all know what that means – National Online Banking Day! Today is the day we celebrate digital finance functionality and all of the ease it brings to our lives. Remember the days before online bill pay, mobile check deposit, and person-to-person payment systems? And as long as we’re being nostalgic, remember the last time you had to constantly write paper checks? If so, aren’t you glad you don’t have to anymore?
Here are some fun online banking facts that you may not know:
New York Novelty
New York City was the official birthplace of online banking all the way back in 1981 when four major banks decided to offer it as a service to their customers…who hated it! The switch from brick-and-mortar was ahead of its time – well before Internet access was ubiquitous – and online banking was shelved until the mid-1990s.
In January 1994, Microsoft built online banking into its Microsoft Money personal banking software. With this one move, 100,000 households found digital banking for the first time.
Credit Union Innovation
The first financial institution to offer online banking to all of its customers was a credit union! Stanford Federal Credit Union provided internet banking services via their website in October 1994, a year ahead of the big banks. Around the same time, the first online-only bank came into existence, sparking the rapid rise of the fintech industry that has since brought us PayPal, Venmo, and Bitcoin.
E-Commerce for Everyone
Once online banking became a thing, e-commerce emerged as an entirely new way to shop and do business around the world. Retail e-commerce alone accounted for $1.915 Trillion in 2016, and these companies expect to keep growing through 2020.
Before Yodlee introduced account aggregation in 1994 – which seems to have been a big year for online banking – it wasn’t possible to view all of your financial accounts in one single place. Minds were blown.
In 2005, the Federal Financial Institutions Examination Council (FFIEC) first announced that financial institutions must conduct risk assessments, evaluate customer awareness, and put security measures in place to authenticate remote access to financial accounts. This set the stage for the quick rise of direct banks -those without a physical branch
– to serve the needs of digital customers and enhanced mobile access for financial institutions that give people the convenience to choose between branch or online channels.
The iPhone launch in 2007 seriously changed the world, expanding access to information, communication networks, and – you guessed it – money. Personal Finance Management (PFM) applications allow you to manage your money and your small business. With PFM, you can even make investments in real time from the miniature computer in your hand. These changes are quickly heralding an era of “social banking.”
But introverts, do not fear! Because we’re talking about financial activity that supports ethical, cultural, and positive environmental impacts. This means access to places people and everything on the planet above profits, all conducted from the comfort of your own digital den.