Online Banking Is Convenient, But Play It Safe

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Despite this being the age of identity theft and online scams, more brick-and-mortar banks are offering their customers products and services for banking on the Web.

Plus, Internet banks, which have no physical branches, are gaining popularity, since they often pass along their lower overhead costs to consumers in the form of high interest rates on deposits.

The number of Americans banking online grew to 40 million in the fourth quarter of 2005, a 27 percent increase over the previous year, according to comScore Networks, a research organization that studies consumer Internet behavior.

Consumers have good reason to bank online — online transactions can often save you money, and their convenience can't be beat. But it's wise to be extra cautious when handling your money over the Web. Follow these tips to ensure online safety:

When handling money online, make sure you only deal with secure Web sites. You'll know a site is secure if you can see the padlock symbol in the bottom right corner of your Web browser. Click the padlock for security details.

Ensure that your computer is secure—always use the "password protect" feature to make sure only you can access the information stored there. Many banks and shopping sites offer to "remember your password"—ignore those offers to prevent other computer users from accessing your information. Avoid accessing your account from a public computer, but if you must, when you're done banking clear the computer's "history" and delete its "temporary Internet files" (usually available under "Internet options" in Internet Explorer), to prevent the next computer user from possibly seeing your sensitive data.

Change your passwords regularly. Never send credit card or account details by e-mail. Be aware of "phishing" scams, as well: If you receive an e-mail asking you to follow a link to a Web site where you must input your information, it's probably a scam. Banks will not ask you via e-mail to update your account information.

Always print your transaction receipts and file them with your bank records until you receive confirmation in your bank statement. Be aware that not all virtual banks are insured by the FDIC — some may be chartered overseas.

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