Ease, Efficiency of Online Banking Add Up to Outbalance Glitches

It couldn’t have been more than a couple of months after I signed up with Bank of America’s online bill-paying service that they made their first mistake. A monthly payment to Honda Motors had arrived late by a day, despite my having ordered it up well within BofA’s required lead time. That meant about $25 in late fees and all the joy that comes from having a late payment on the few dozen secret databases that credit companies keep. That’s the bad news.

Here’s the good news. Prompted by my one phone call, the bank turned all this around in 48 hours. They sent a letter to Honda with a copy to me and cajoled the finance company into reversing the late charge. Some further good news: Their first mistake was their last one. That’s the only error BofA has made in my online banking account in three years.

It may be hard to believe, given all the grief that big banks can cause their little customers, but BofA’s online banking appears to be a service that works. For one thing, it’s free. There are no monthly fees for the bill-paying service and, as far as I can tell, no limits on how many payments you can make or to whom. The Web-based interface is clean and informative.

In recent months the service has even improved: Assuming your computer runs the latest Web browser released by Microsoft or Netscape, you can schedule regular payments to be made to such recipients as mortgage and auto lenders.

While I was a Citibank customer, I avoided using their pioneering online service to pay any creditor likely to charge a late fee or generate a credit bomb for a late payment. BofA’s has so far proved so reliable--knock wood--that I’ve now scheduled all my mortgage payments through next year.

The system also tells you which vendors get electronic payments from BofA (mostly local utilities and credit card companies) and who gets mailed a check. That’s useful because you have to schedule payments only two days in advance to be assured of timely electronic payments. That means your money stays in your account a few days longer, earning interest. All others require a lead of five days.

BofA also allows customers to perform such tasks as ordering blank checks, check copies, statements and payment stops online.

The service isn’t perfect. BofA doesn’t allow you to make payments to new vendors immediately; instead you have to wait a few days until a new address is entered into the bank’s database. With Citibank, I could type in a recipient’s name and address and have the payment go out within a day.

Also, the downloading of my bank statements suddenly developed a bug some months ago that makes it impossible to transfer them directly into my Quicken money management program.

But these are minor flaws. BofA’s online reliability is its best feature. When I was a Citibank customer, I found a material error in my online account on average every three or four weeks, many of them requiring months to rectify. (Guess why I’m no longer a Citibank customer.) If only I could make deposits through my computer or have it spit out cash, I’d be in banking heaven.