The internet has overtaken high street branches as web users' preferred channel for banking, according to a survey.

Eighty per cent of the UK’s online population has embraced internet banking with 64 per cent managing credit card finances online, despite nearly 41 per cent admitting to being afraid of online fraud.

'The results confirm that consumer confidence in the internet is at an all time high. Managing finances, choosing and managing a credit card online, is having the knock on effect of increasing retail sales and saving people money,' said Gavin Reeder, head of strategy at BLM Quantum, who commissioned the study.

Social networking and mobile banking are also becoming increasingly popular.

Ten per cent of respondents said mobile phones would be useful for making payments, and five per cent would like to bank via digital TV.

Of those people who fell victim to credit card fraud, 61 per cent are very satisfied with the way it was dealt with by their bank. Only six per cent were disappointed, and six per cent very disappointed.

Online banking is also boosting retail internet sales by making people feel more confident about purchasing on the web. Some 66 per cent of respondents say that managing their money on the internet has made them more confident when purchasing online.

And 53 per cent of respondents admitted to purchasing more products and services online as a direct result of increased confidence from managing finances on the web.