Credit Cards Online Information

IN THEORY, the convenience and simplicity of online banking make it a godsend for busy entrepreneurs. Yet recent surveys show that small-company CEOs are slow to migrate their business banking online, lagging behind consumers and big companies.

A survey released in December 2004 by Forrester Research found that while small-business owners are active internet users, only 19 percent of those surveyed were actively using online banking, and just 13 percent were actively paying bills online. The "Small Business Research 2005 Study," performed by Edgar, Duma & Co., a global financial services and payments consultancy, and Collective Dynamics, a management and technology consulting firm, found that while 57 percent of responding entrepreneurs used online banking daily or weekly, only half paid their bills online; 28 percent had no interest at all in online banking. Why? The most commonly cited reason, reports John Bresnahan, director at Edgar, Dunn & Co., was concern about internet security.

"Businesses of this size are very conscious of security," echoes Anita Campbell, CEO of Small Business Trends, a website that monitors trends in the global small-business market. "Every time we have one of these scares about credit card numbers or banking records being compromised, that gives business owners pause."

Indeed, the recent security lapses at major financial institutions have done nothing to quell business owners' fears of putting their account information online. Avivah Litan, vice president and research director at Gartner Inc. and author of several studies on online security, says their wariness is understandable. "They're not nearly as well-protected in the banking world as consumers are," she says, "especially when it comes to online information theft."

Federal regulations require banks to reimburse consumers for unauthorized transfers from their accounts, says Litan. But there is no corresponding legislation that protects small businesses. "Small businesses are kind of left behind when it comes to banking," says Litan. Until new regulations appear, if banks want business owners to feel more at ease, they'll have to "make their own liability guarantees," she says.

# posted by Medical Information : 3:56 AM