Is Online Bill Pay Right For You?

Pros and cons of Online Banking

Pros and cons of Online Banking

This day and age is evolving into a largely digital era, and included in that evolution is finances. Online bill pay is an electronic payment service that allows you to set up secure accounts on the Internet to make one-time or recurring bill payments. Many love this innovative technology for its simplicity and economy, and a few shun it for big businesses’ hidden fees, the possibility of making mistakes and the risk of scams, insecurity and viruses. Read on to see for yourself if online bill pay is right for you.

The first thing a potential online bill payer needs to do is to figure out his or her needs. Do all of your billers accept electronic payments? If not, you will need a bill pay site that will accommodate that by issuing them paper checks. If that is the case, you also need to know to schedule that bill to be paid a little earlier to account for the time your bill pay company needs to send that live check out via the mail (usually about five days).

Furthermore, are your bill amounts the same every month? If not, a scheduled — not automatic — payment through your financial institution might be your best bet; that way, you have access handily to your checking and/or savings account information for variable amounts so as to avoid overdrafts.

There are many free online bill pay websites available to consumers; there are also many financial institutions that offer it via their websites, as well. Be sure to read all disclaimers and fine print to alleviate the fear of hidden fees. It may be a good idea to choose your next financial institution based in part on if they do offer free online bill pay, if that is what strikes you.

Similarly, you can put the control into the hands of the lenders and have the billers debit your account by signing up on the creditor’s own site. Whichever way you choose, automatic, scheduled payments help avoid late fees; they also have the potential to be a very well-organized way to manage your bills.

Dan Kadlec, a personal finance journalist for TIME Magazine, recommends doing all of your banking online for its personal and environmental efficiency.

“Stamps, envelopes and physical checks are an obsolete expense. You’ll save time, too,” Kadlec said. “But best of all, your bank will automatically keep track of what you spend and where you spend it for easy review, which makes budgeting a lot simpler.”

Reducing paper waste by banking and paying bills online does more than save the trees; it helps save the planet by reducing the fuel used by the vehicles that transport the paper statements, bills and checks. Javelin Strategy & Research found that if every U.S. home viewed and paid its bills online, the switch would cut solid waste by 1.6 billion tons a year and curb greenhouse-gas emissions by 2.1 million tons a year.

Some things to look out for

The main concern for anyone doing absolutely anything online these days is security.  But it doesn’t have to be distressing. Make sure your computer has the latest virus protection, never access your account from a public wi-fi system or on any sort of shared device and change your passwords regularly. Also, be on the lookout for messages that claim to be from your financial institution or bill pay company; they could be phishing scams from con artists trying to gain access to your account information. Don’t give out any personal or account information without confirming the source first. As mentioned before, monitor your accounts and statements and watch out for any transactions that you didn’t authorize.

Additionally, one must be careful of typos while paying bills online. You wouldn’t want to accidentally pay $36,000 for a $360 bill, right? Misplaced decimals are small, but frightening. Also alarming is the possibility of forgetting to hit the “Submit Payment” button at all. About 0.18 percent of online bill payments are challenged for mistakes every year (not including errors consumers catch and fix on their own), which translates to millions of snafus when taking into account the billions of payments submitted online each year.

Most of the time, financial institutions or companies will help sort out any problems, but Nessa Feddis, a senior vice president at the American Bankers Association, confirmed that it is much more efficient to just do it correctly the first time.

“It is very easy in this electronic world to get caught up and move quickly, hit the send button before we mean to. We all need to take time, pause — and make sure the transaction is accurate,” Feddis said. Feddis recommends signing up for the bill pay site’s e-mail alert system, and that of your financer, as well, to be notified when a payment or change in your account has been made. This will help catch any mistakes or fraudulent behavior.

Weighing the pros and cons

In short, the positive qualities of online bill pay are abundant, but the practice is not without its difficulties. There are a lot of aspects to consider, such as the convenience factor based on your specific circumstances. It can be a very quick and efficient way to disseminate money because it can be done all in one setting, and it also saves the environment in more ways than one.

On the other hand, Internet security is always a concern for any interaction done online, and mistakes are an inevitable part of life, so vigilance and awareness are a huge necessity in managing finances online. The responsibility of weighing these options and making an informed decision is that of each consumer individually.

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Five Common Online Banking Mistakes

7-14 OnlineMany will argue that banking online has been the best invention since sliced bread. And there’s no doubt about that: no more statements and papers — everything is on your computer or mobile device, right at your fingertips.

But while banking online is certainly a feat that will make your life easier, there are some things that people do without even realizing it can be hazardous to your account safety. For your own security and protection, avoid these top online banking mistakes:

1. Don’t use an easy-to-guess password – You may be surprised at how many people don’t use original passwords, and how dangerous it can be. In an analysis of 32 million passwords done by Imperva, an Internet and data security company, found the top 10 passwords are: 123456, 12345, 123456789, Password, iloveyou, princess, rockyou, 1234567, 12345678 and abc123. These give hackers an easy in to your account. If you’re using one of these or something similar, consider changing it. Note that the best passwords are ones that use both letters and numerals and involve both lowercase and uppercase characters. Also, avoid using the same password for multiple accounts.

2. Don’t use public Wi-Fi – When it comes to online banking, accessing community Wi-Fi is a no-no. Why?

“People generally don’t bother to check out the security characteristics of public networks before logging on, plus wireless transmissions can be intercepted by nearby Bluetooth-type devices,” says Richard Barrington, a spokesman for MoneyRates.com. That includes public libraries, too.

“The PCs [at libraries] are subject to viruses and spyware that you have no control over,” explains Robert Sicillano, a consultant for McAfee, an expert on identity theft.

3. Don’t dismiss anti-virus protection - This kind of software helps detect and protect you from malicious software (malware) and computer viruses. That’s important because “[Common viruses like] trojans and worms can infect your computer and use keystrokes and other tactics to get your bank credentials,” warns Sol Nasisi, chief economist at BestCashCow.com. It’s best if you set up your protection software to automatically update daily. Also, sometimes your financial institution may provide free software, so be sure to ask about it if you’re unsure.

4. Don’t ignore your account - Check your account regularly. That will help ensure nothing suspicious is going on in your checking and savings accounts. Try checking it once a day or week, but at minimum, you should be looking at it once a month. If you see any suspicious activity, report it to your bank immediately.

5. Don’t post password hints on social media – It sounds obvious, but don’t share any super personal information on any of your social media accounts, including Facebook, Twitter, LinkedIn, etc. Doing so makes it easy for criminals to use this information and possibly open up an account in your name, or even use it to guess what your password is.

“It’s important to be careful sharing your pet’s name, your children’s names, or the name of the high school you attended, especially if you use this information as account passwords or answers to security questions,” says Lisa Robinson, a senior vice president at Wells Fargo Internet Services Group. “Never share your mother’s maiden name, your Social Security number, your bank account numbers, or your user names or passwords for any account.”

Includes copyrighted material of IMakeNews, Inc. and its suppliers.

Mobile Banking is Easy: Here’s how to start

person on smartphoneWhat do you need to do to access Merchants Bank’s Mobile Banking? Simply, you need to make sure you are enrolled in Merchants Bank’s Online Banking and then log into your account.

If you are a first-time user, simply go to the Merchants Bank home page and click on “Enroll” in the upper left hand corner. You can also find an informative “Demo” there.

Once you’ve enrolled, go to “Other Services” and click “Mobile Banking” to complete the enrollment process. You can download the free app you need for your Android or Apple phone or tablet device at our website. You can also download Merchants Bank’s free mobile app through your mobile phone or tablet device. The free Android app is available at the Google Play store and the free iPhone or iPad app is available at the Apple App Store or on iTunes.

Once your app is in place, you will be able to enjoy these Mobile Banking benefits:

  • Check account balances.
  • View recent transactions.
  • Transfer funds.
  • Find Merchants Bank branch and ATM locations.
  • Contact Merchants Bank Electronic Banking customer support.

If you’d prefer to utilize text banking, you can do so without downloading an app. Our Electronic Banking Department will be able to help you.

If you have any questions, please give our Electronic Banking Department a call at 866-496-0522.

 

Password Security Tip

While your children’s names, pet’s name, address, phone number, favorite sports team, favorite actor or actress, vacation spot, etc., are very memorable, there’s one thing they are not: good passwords. Most criminals can figure them out without much difficulty, and those criminals can also find those passwords when written down. So, what do you think is a secure password? A mixture of upper and lower case letters, numbers and symbols. A good tip is including at least three special characters before, after or within a password. For additional security tips, visit our website.