December 02, 2002, 10:20 AM — The popularity of banking online continues to grow in the U.S. with about 37 million Americans, or 32 percent of U.S. Internet users, now conducting banking transactions over the Internet, according to survey results released last week by the Pew Internet & American Life Project.
That compares with 14 million Americans who said they used online banking services in 2000, an increase of 164 percent in two years, according to the study posted on Pew's Web site last Thursday.
The convenience of banking online is what appeals to many, with 79 percent of the study's respondents saying that convenience was "very important" to their decision to first bank online, followed by 71 percent who felt that online banking saved them time, Pew said. Other factors included better control over finances, not having to talk to anybody, getting more information and saving money, Pew said.
The study found that men are somewhat more likely to bank online than women: 35 percent of male Internet users have done so, while 30 percent of female Internet users bank online, Pew said.
Younger and middle-aged Internet users are the most likely group to turn to online banking. According to the study, 33 percent of Internet users between 18 and 29 years old bank online, followed by 36 percent of Internet users between 30 and 49 years old, 27 percent of Internet users between 50 and 64 years of age and just 16 percent of Internet users age 65 and older, Pew said.
Education and income also play a role in determining who chooses to bank online: Forty-one percent of college graduate Internet users bank online compared to 23 percent of Internet users with a high school degree, Pew said. Forty-four percent of Internet users with household incomes of US$75,000 or more per year have banked online, compared to 21 percent of Internet users with household incomes of less than $30,000 per year, the study said.
In terms of race, 32 percent of white Internet users bank online, followed by 33 percent of Hispanic Internet users and 30 percent of African American Internet users, Pew said.
The study found that online banking attracts a more diverse group of Internet users than other financial activities such as buying or selling stocks online (12 percent or 14 million Americans, compared to 10 million in 2000) or seeking financial information online (42 percent or 49 million Americans, compared to 37 million in 2000), Pew said.
Another online activity growing in popularity with Americans is making a travel purchase or travel reservations over the Internet, with 59 million Americans (50 percent of U.S. Internet users) doing so in 2002, compared to 31 million Americans (36 percent of U.S. Internet users) in 2000, a two-year increase of 90 percent, Pew said.