CR Money Adviser lists best online banks

Dear Action Line: Which are the best online banks? I have been doing business with ING for some time now, but I understand that five or six others are now also offering banking online — 24/7 instead of just "bankers' hours." — C.D., Tulsa.

There are at least seven online banks: ING Direct at tulsaworld.com/INGdirect, HSBC Direct at tulsaworld.com/HSBCdirect, Citibank at tulsaworld.com/CitibankOnline, Capital One at tulsaworld.com/Capital1online, Bank of America at tulsaworld.com/BOAonline, Chase at tulsaworld.com/ChaseOnline and Wells Fargo at tulsaworld.com/WellsFargoOnline.

The July issue of Consumer Reports Money Adviser rated the largest online banks with a nationwide reach, evaluating four types of accounts — regular and money-market savings, CDs, and checking.

It rated veteran ING Direct and HSBC Direct at the top of its online bank ratings, giving them scores (from zero to 100) of 80 and 78, respectively, considering interest paid on savings accounts, money market and one-year CD interest paid, fees charged for "low balance," minimum deposits and monthly fees charged for "bill pay." The two also won in interest paid on savings accounts: 1.5 percent and 1.65 percent annually.

Next in the score levels were Citibank with 72 percent, CapitalOne and Bank of America both with 61 percent, Chase at 58 percent and Wells Fargo at 50 percent.

Many people are afraid of online banking due to fears of identity theft, but all the institutions the magazine rated require customers to use Web browsers supporting 128-bit encryption (the basis of the Advanced Encryption Standard adopted by the National Institute of Standards and Technology in 2001). This encryption is used in every online banking transaction.

The newsletter chose accounts to rate with the lowest balance requirements and not requiring additional business with the bank. Fees and annual percentage yields were considered most important in the ratings, counting for half the score. They were also rated on interest rates paid on deposits (minuscule as they are); service fees, the ease of transferring funds between accounts; and amenities such as cell-phone banking, electronic bill payment and integration with personal finance software.

The online gap between ING and HSBC and other larger banks is no longer as great as it was. All the banks the magazine reviewed offered cell-phone banking with at least some, if not all, of the major devices and carriers. And all of them support at least one of the two major personal-finance software suites, Quicken and Microsoft Money. Of the banks rated, Chase was the most egregious assessor of fees.

Submit Action Line questions by calling 699-8888 or by e-mailing phil.mulkins@TulsaWorld.com or by mailing it to Tulsa World Action Line, PO Box 1770, Tulsa OK 74102-1770.

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CR Money Adviser lists best online banks

Dear Action Line: Which are the best online banks? I have been doing business with ING for some time now, but I understand that five or six others are now also offering banking online — 24/7 instead of just "bankers' hours." — C.D., Tulsa.

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