Recent history witnessed the advent of online banking and it seems like the industry is here to stay. Why not? An online bank spends less on infrastructure and labor; thus, it is able to offer a lot of perks to its clients. Even though security is a major concern for most people, many trust the online banking system. Today, Internet banks are becoming a powerful force in the banking and financial industries. One of these successful internet banks is eTrade Bank.

Based in New York, eTrade Bank is a subsidiary of a financial services giant, the eTrade Financial Corporation. The company’s main business is an online discount stock brokerage service offered to self-directed investors. Because all transactions are done online, the bank charges a much lower fee on each service and product including savings and checking accounts, certificates of deposit, money market accounts, mortgages and credit cards.

Where It Began

The beginnings of eTrade Financial Corporation can be traced back to 1982 when Bernard A. Newcomb and William A. Porter founded TradePlus Inc. in California. Nine years later, Porter set up a new company called eTrade Securities Inc. The services were offered via Compuserve and America Online. In 1994, TradePlus and eTrade became the fastest-growing private firm in the United States with revenues close to $11 million. Eventually, the company’s name changed to eTrade Group after undergoing a major reorganization. In 2003, the name changed again, this time to eTrade Financial Corporation. By then, the company was already public. In 2005, the company acquired BrownCo, a discount brokerage service or JP Morgan and Harrisdirect, a discount brokerage service of the Bank of Montreal.

Maintaining Balances and Maintenance Fees

While eTrade Bank does not charge ATM withdrawal fees, you have to maintain a balance above a certain amount for two reasons: minimum balance and maintenance fees. This means that if the amount of money left in your account is below minimum, you won’t be earning interest. In addition to that, the bank will also collect maintenance fees so it is best to avoid crossing the minimum line.

Things You Need to Know

Aside from the rates and fees, there are other things you need to know about eTrade Bank to save yourself some time and money. First, eTrade Bank is a completely online bank and not a physical bank. Meaning, everything is done through the Internet or over the phone.

Second, you should not deposit cash. Obviously, there is no way to send cash through the mail and even when it arrives to the bank, they won’t take it.

Lastly, like most online banks, transactions do not happen in real-time. This means that it takes time before the transaction takes effect, especially when you want to be credited for the deposits you make. It usually takes up to four days to get your checks through unless it is direct deposit. If you don’t have enough funds in your bank account, you need to deposit some as soon as possible.

If you want to know more about eTrade, visit their website at. You can also contact any of its customer service representatives, who are known for being responsive and excellent.