Online banking is one of the most recent "value added" services banks are offering to catch and keep customers. This service offers simplicity and convenience to customers by taking advantage of new computer technology and cutting-edge software programming.

Most individuals are used to receiving paper bills and sitting down at their desk to write out checks, address envelopes, and affix proper postage in order to pay them; and everyone is familiar with the extensive length of time it takes for "snail mail" to get to its destination, adding the stress of wondering whether the payment will make it to the creditor in time to the already tedious task of bill paying. Online banking, or online bill pay, helps alleviate many of these stressors by simplifying and speeding up the process.

Many of today's businesses allow customers to pay electronically, whether through credit card, debit card, or electronic check (e-check). By logging into the creditor's website and completing their online bill paying requirements (usually the user's name, address, and creditor account number), and then entering in the user's bank routing number and checking account number. Once the transaction is completed, the user receives a confirmation acknowledgement including a confirmation number, and sometimes a confirmation email. On the bank's end they receive the electronic payment request and execute the payment very much like they would if it were a physical check, but of course with a few differences on their end.

Other banks who offer online banking have a bill paying page on their website where users can enter in all of the pertinent information regarding their bills; for example, the merchant's name, the user's account number, name, address, and other contact information. Then the user can set up a date for the bill to be paid, and on that date the bank will pay the merchant via an electronic check or debit from a debit card. There are different ways of paying bills online; each bank has their own system. However, paying bills online is only one aspect of online banking.

As mentioned earlier, banks who offer online banking usually have a website where customers can log in and see their accounts just as they would view a paper statement mailed to them. Deposits, accounts, withdrawals, even images of checks can be seen 24 hours a day, 7 days a week on the site of a bank who offers online banking to customers. Those who have loans or mortgages can see the details of their account transactions; for instance, they can see how many payments they have made, what their interest rate is, how many payments they have remaining, due dates, and other statement details. Detailed account information for checking and savings accounts can be seen as well. Customers can check their account balances, see how much they have available for withdrawal, and deposits made, just as they would their paper statement. Some banks will make customer statements available electronically on their websites instead of mailing out a paper statement each month. Sometimes, as another added bonus, banks will offer special interest rates or discounts for customers who choose to do their banking electronically.

Online banking is a great way to draw in and retain customers because it simplifies and streamlines their bill paying experience. Paying bills online saves time because there are no checks to write, envelopes to address, or stamps to adhere; it makes the bill paying process more efficient because bank customers can pay most, sometimes even all, of their bills at once from one website, and these two conveniences make an otherwise tedious and stressful chore much easier to manage.