There are two types of online banks: traditional brick and mortar banks that offer online services; and banks that exist only on line. The two largest online-only banks are Telebank and Net.B@nk.
Web bank customer Andrea Thabit trumpets the flexibility of the services. "I can go anywhere and access my account, pay my bills, transfer money," she says.
Online banking analyst James Marks agrees: "You get checking, money market accounts, CDs and limited access to lending products."
Analysts say you get most of the same services as a branchless bank but the biggest difference is in withdrawing money. Online banks issue debit cards which you can use at another bank's ATM, but you may be subject to that bank's fees if you use them.
But, Marks continues, "A lot of the online banks are absorbing the cost of those charges because they know it's such a sensitive issue for a consumer. The theory behind this is that we've got lower operating expenses because we don't have mortar and branches so we can afford to pay it."
For those concerned with safety, online banks are insured by the FDIC and analysts say your financial information is safe.
Thabit agrees: "I don't understand why everybody is not netbanking. It just makes sense."