Online Banking #2

Last week we discussed the advantages offered by doing your banking online with your existing high street banker such as Barclays, Lloyds TSB or Halifax; While we concluded that by doing your banking in this style offered the advantages of convenience and speed, it offered little extra financial incentives.Fortunately, the Internet offers numerous cost savings to those companies who choose to do business on it; the online only bankers have a number of advantages over those offering a traditional brick & mortar approach.

So today we’re going to look at the bankers that specialise in doing business over the Internet ONLY – Companies which practically have no physical existence, if you ignore the large centralised offices and call centres of course.

First off is Cahoot (www.cahoot.co.uk); Offering current accounts, credit card, loans, savings and investments and insurance, Carhoot is a well established online division of Abbey National.Some of its most noteworthy features include up to 4.55% gross AER on your current account, a credit card which offers a standard 8% APR and standard loans with an APR from 8% as well..

In terms of access to your accounts, the site obviously offers management of your finances online as well as well as via WAP (Wireless Application Protocol; a technology used to access text based information on many of todays’ mobile phones) or over a conventional phone line.

One very disappointing feature is that most areas of the site only cater for those of 21 years of age or over.This instantly disqualifies myself as well as any other young technologically savvy Internet users, probably the kind of people that I would have thought would have been most likely to choose an Internet based account in the first place.

The second, and really only other major solely online banker is Egg (www.egg.com), a long established name on the Internet who is a member of the Egg group of companies which encompasses Prudential banking.Current special offers include 0% APR on all new credit card purchases and balance transfers until August 2002.This card has no annual fee, and offers you cash back on every new purchase you make, whether you’re Christmas shopping or filling the car with petrol.

Egg also specialise in lending money, their APR rates are from just 10.7%, a fair bit more than Cahoots low 8% but still a great deal less than the 14.9% offered by many of the high street bankers.

Egg unfortunately doesn’t offer current accounts to their customers, although they do cater for those requiring high value savings and investment accounts and mortgages.Insurance is also another area where they have established themselves, whether it be for your household, motor or even life.

Exclusive online shopping offers are available to Egg customers, such as an X-box (Microsofts’ new PC style console, a feature on which will be coming to the Herald Express soon) for £289.05, 15% off Virgin mobile phones, £1000 prize draw, free £100 worth of wine with new ISA’s as well as numerous other deals.

I myself only own an Egg credit card and so obviously I have been unable to test any of the products personally and so this isn’t like a traditional product review but more an informative article.As this article is in no way associated with either of these banks, I suggest that you visit their respective website for any further information to ensure that all information given is correct.As always think carefully before undertaking any investment or commitment, as you would with any traditional bank.If you are worried about the privacy issues surrounding online banking then I suggest that you visit www.thisissouthdevon.co.uk where you will be able to read last weeks article based on this subject so that you can make your own informed decision.

About the Author – Chris Holgate works for Refresh Cartridges who supply a wide range of printer cartridges at the UK’s lowest prices.

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