Each month, Danuta becomes more frustrated with the fees she pays for financial services. Recently, her chequing account and ATM fees were over $15 a month. In addition, Danuta is frustrated by the lower quality of customer service. 

Danuta is considering a Web-only bank that offers continuous access to account information along with electronic bill-paying service. She would earn 1.5 percent interest on funds in her chequing account, which is about ten times higher than what she currently earns. But since the Web-only bank doesn’t have its own ATMs, she could incur significant fees when obtaining cash from an ATM. On the positive side, she would have access to low-cost, online investment trading. 

The Web-only bank requires direct deposit of paycheques. Cash deposits would have to be handled through an ATM or through an electronic transfer at a traditional bank. 

Danuta’s current bank does offer online capabilities as well electronic banking but she does not make any interest on her account and still has service fees. She likes the interest that she can earn in the savings account but is also concerned about deposit insurance with the Web-only bank. 

Questions 

1. What factors should Danuta consider when comparing a Web-only bank and online banking with her current financial institution? 

2. Locate Web sites that Danuta might use while considering online banking. 

3. What actions would you recommend for Danuta?