Best Online Banks

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by Tom Rains ConsumerAffairs Research Team

Online banking allows consumers to access their money online whenever and wherever they want. As a bonus, you can expect higher interest rates on online savings accounts and checking accounts. Online banks provide a legitimate alternative to consumers looking for something other than a traditional brick-and-mortar bank.

Compare the Top 10 Online Bank Reviews

Green Dot Prepaid Cards
Read 6137 Reviews

Founded in 1999, Green Dot is a prepaid debit card company which allows customers to pay rent and send out other payments. The company doesn't charge overdraft fees and doesn't require a credit check in order to get a card.

Capital One
Read 4503 Reviews

Capital One offers customers a range of cards, including Travel Rewards, Cash Back and Building Credit Cards. As one of America's ten largest banks, the company offers a wide range of financial services to consumers.

Ally Bank
Read 975 Reviews

Ally Bank offers online checking and savings accounts, CDs, IRAs and other financial services. While the bank has no branches, customers can use the Ally website, Mobile Banking App and 24/7 phone service.

Synchrony Financial
Read 762 Reviews

Synchrony was formerly known as GE CareCredit, and they have over 80 years of experience in the industry. They provide many different credit options for customers, and offer rewards programs for long-term clients.

Read 731 Reviews

Discover is a credit card company headquartered in Riverwoods, IL, that offers a selection of credit cards to consumers. Discover customers can choose from cards including Miles Rewards, Cash Back, and Students cards.

USAA Banking
Read 462 Reviews

USAA serves former and current members of the military, as well as their families. The company offers insurance services, investments and tax help for qualified customers, in addition to banking, credit cards and mortgages.

Fidelity Investments
Read 514 Reviews

Established in 1946, Fidelity offers many investment products, including online U.S. and international trading. The company is headquartered in Boston and has over 190 branch offices across the country.

Charles Schwab & Co.
Read 238 Reviews

Charles Schwab has been in business since 1973. The company offers extensive financial and investing services, including online trading, managed investment and retirement accounts, banking and credit cards.

Bank of America Online Banking
Read 179 Reviews

Bank of America online banking offers its customers secure access to their checking and savings accounts. Other Bank of America services includes bill pay, customized alerts and the ability to transfer money between accounts.

Chase Online Banking
Read 141 Reviews

Chase online banking enables customers to deposit checks, check their balances and more, during any time of the day, on multiple devices. Customers can manage their accounts from their computers, smartphones or tablets.

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An online bank offering one account that is a mix of a traditional checking and savings account. A solid 2% APY is a big attraction. Reimbursements for any ATM fees makes it easy to withdraw money wherever you are.

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Online bank with a wealth of budgeting tools. The Pay Friends feature makes it easy to send money. Mobile notifications keep users up to date, and access to a large ATM network means withdrawing cash is simple, wherever you are.

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An online-only solution to student debt. Experts work with you to create a personalized repayment plan to help eliminate your student debt. The company claims it can save students up to $450 a month on their student loans.

Finn by Chase
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This mobile banking app, backed by a big name in banking, targets users looking to track their spending and save up for big purchases. Features like a debit card and direct deposit capabilities keep it highly functional.

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An online-only bank with a highly rated mobile app, no overdraft fees and access to an extensive network of ATMs. This is a good option for those with less than optimal credit, as the bank does not check credit histories.

Greenhouse by Wells Fargo
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The convenience of a mobile banking app meets the security and reliability of a large bank. The app features budgeting tools, online bill pay and the opportunity to send money to friends and family.

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Online bank that helps users save and keep track of their spending with features like Safe-to-Spend. Users can qualify for a 2.02% APY if they have a Protected Goal Account that meets the minimum balance requirement.

SoFi Money
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Online-only bank with super fast 60-second signup. There are no fees, and the APY on their hybrid check-savings account is 2.25%. Pay friends and family easily through the mobile app.

Varo Money
Read Expert Review

Offers free checking accounts, APY up to 2.8% on savings accounts and fee-free access to over 55,000 ATMs. Easy-to-use budgeting tools also sweeten the deal.

Top 4 best online checking accounts

When looking for the best online banks with a checking account, we considered fees, interest rates on checking and savings accounts, security, budgeting tools, account options, customer service, ATM availability, balance requirements and consumer reviews. When choosing an online bank, ask about security measures that ensure your money is safe. You should also find an online bank with an interface that feels straightforward and easy to use. Last of all, any online bank you choose to do business with should be backed by the Federal Deposit Insurance Corporation (FDIC), just like any traditional bank.

Best online banking experience
Chime Bank

Company nameContact
Chime Bank
  • No minimum balance requirement
  • 0% APY
  • $2.50 for out-of-network ATMs

What we like: Monthly maintenance fees and overdraft fees simply don’t exist on Chime. In fact, Chime has practically no fees at all. Customers have access to over 38,000 MoneyPass ATMs, all of which have no withdrawal fee. This leads some people to wonder how Chime makes money. They do this by charging merchants instead of customers.

Consumers praise Chime’s interface and additional features. One useful feature called Save When You Spend lets you round up every charge on your debit card. The additional cents added to the purchase are deposited into your Chime Savings account, which automatically comes with each checking account. Another great feature is Checkbook, which can write checks for you online and even send them for you. A direct deposit feature is available for paychecks. Chime will process the payment instantly instead of waiting a few days like other banks. If you want, you can even automatically divert 10 percent of your paycheck into your savings account.

Additional good news for international travelers is that Chime has no foreign transaction fee.

What to consider: The one fee that does exist on Chime is a $2.50 fee for out-of-network ATMs. Fortunately, with 38,000 ATMs available, this fee is easy to avoid. Another thing to keep in mind is that you don’t earn interest on their checking account, and interest on the savings account is just 0.01 percent.

Who it’s best for: Chime is best for those looking for an effortless online banking experience. If you’re new to online banking or want an easy-to-understand online banking experience, Chime is a great choice.

Best online bank for budgeting

Company nameContact
  • No minimum balance requirement
  • 0.01% APY
  • No fees except from out-of-network ATMs

What we like: Simple is designed to help consumers budget better. With Simple’s budgeting tools, you can specify how much your regular expenses are. Simple marks this money as necessary for those expenses. Then, it allocates money to savings categories created by users, like a vacation or a new pool. The money leftover is designated as safe-to-spend money. This makes it easy to know realistically how much money you have free to spend.

Simple has two types of accounts: the Simple Account and the Protected Goals Account. The Protected Goals Account is Simple’s version of a savings account. It earns 2.02 percent APY if your account has $2,000 or more.

Like many other online banks, Simple is virtually fee-free. Simple has no minimum balance requirement, overdraft charges or monthly fees. With over 40,000 Allpoint ATMs, withdrawals are also free.

What to consider: Like other online-only banks, Simple has no physical locations. Simple doesn’t provide any Certificates of Deposit (CD), so it’s best to look elsewhere if you want a savings account with a higher interest return. You also are not able to deposit cash directly.

Who it’s best for: Simple’s intuitive budgeting features make it best for those looking to control their spending. The app does a fantastic job of letting users know what money is available to be spent and what money should be reserved for necessary purchases.

Best online bank for interest rates
Ally Bank

Company nameContact
  • No minimum balance requirement
  • 0.1–0.6% APY
  • No fees for regular services

What we like: Ally’s savings account has a 2.2 percent APY, no matter the account balance. That’s one of the best APY rates you’ll find on a savings account. You can also link your checking and savings account and receive free overdraft protection. Ally’s checking account is as effortless as they come. It doesn’t require an initial deposit or minimum balance. Interest is 0.1 percent for accounts with less than $15,000. For accounts with over $15,000, the interest is 0.6 percent. Remote deposits are available through the Ally app. You can also send or receive money from friends and family.

With Ally, you are able to use more than 43,000 Allpoint ATMs free of charge. Ally also provides a $10 allowance each month to reimburse users for charges incurred from using an out-of-network ATM.

Ally’s customer service receives high praise from consumers. You can call by phone, chat online, send messages through online banking or even contact Ally on Twitter.

What to consider: Like other online banks, there are no physical branches and there’s no way to deposit cash into an Ally account. Other than that, Ally is a safe bet for most people interested in online banking.

Who it’s best for: Ally is best for people looking for high interest rates on their savings account. Ally offers a 2.2 percent APY for all savings accounts and .1–.6% APY on checking accounts.

Best online bank for students
Finn by Chase

Company nameContact
Finn by Chase
  • No minimum balance requirement
  • 0.01–0.04% APY
  • No monthly fees

What we like: Finn by Chase is an iOS and Android app. The app serves both as a banking tool and as a budgeting tool. Finn wasn’t the first fully digital bank, but it was the first one backed by a large existing bank. Customer service specifically for Finn is available 24/7.

Finn offers a $100 signup bonus when you open a checking and savings account. You can specify an amount to automatically enter your savings account with every paycheck. You can also set up personalized savings transfers. For example, you can ask Finn to put $2 in savings every time you buy a coffee. Finn also has charts and emojis to help categorize spending.

Finn, like other online banks, has very few fees. There are no monthly fees or overdraft fees. If a user tries to spend more than is in her account, the payment is simply declined. Finn also has access to no-fee ATMs in every state.

Finn by Chase has a tiered interest rate structure on checking accounts. Accounts with less than $10,000 earn 0.01 percent interest, accounts with $10,000–$24,999 earn 0.03 percent interest and accounts with more than $25,000 earn 0.04 percent interest.

What to consider: Most savings accounts with Finn only earn 0.01 percent—not too impressive, especially compared to other online banks, some of which offer more than 2 percent in interest. The uber-youthful feel might also be a turnoff to some—not everyone wants to categorize their spending using emojis.

Who it’s best for: Finn by Chase is a great option for those who have been interested in but cautious of total online banking. The Chase name brings a lot of experience to a relatively new concept. Its youthful feel and budgeting features also make it great for students.

What is online banking?

Online banking is when you conduct financial transactions through a computer, tablet or mobile phone via the internet. Through online banking services, you can open a bank account, pay your bills, deposit and transfer funds, check your balance and apply for loans. It’s also easy to keep track of changes in your account.

Online-only banks do not have physical branch locations. Usually, an online bank can provide their account holders with most of the same services as traditional banks. Customer service representatives are available over the phone, by email or via an online chat. Online banks can even make provisions for account holders to use other banks’ ATMs to withdraw cash without paying a fee.

How does online banking work?

Sometimes called “internet banking” or “web banking,” online banking makes it easy for account holders to manage their finances online through their computer or smartphone. Because online banks don’t have the overhead associated with physical locations, they can often charge fewer or even no fees and offer higher interest rates on savings accounts.

To deposit a check, you can simply take a picture with your phone and upload it through your online banking’s secure portal for payment. It’s easy to check on your account’s status and balance through apps or text messaging.

Are online banks safe to use?

Online banking security is more advanced than ever, and some experts consider online banks to be safer than brick-and-mortar banks. You complete all of your financial transactions through a secure web portal, and encryption scrambles your data, which makes it secure against hackers. Direct deposit eliminates the risk of someone stealing your check from the mail.

Plus, online banking often comes with sophisticated fraud monitoring, two-step authentication and login alerts. You should be sure to always use your data plan to access your online banking account. Accessing your online bank account while connected to public networks opens you up to hacking and unauthorized access.

Even if you’re diligent, scammers are out there. To be on the safe side, make sure you have a hard-to-guess password, and don’t write it down anywhere. Keep your device updated and never give account information over the phone or through email or text messages.

Online banking vs. traditional banking

Many traditional banks and credit unions offer online banking services that allow you to deposit checks and pay your bills quickly and conveniently online. On the other hand, an online bank doesn’t have any physical branch locations, so making a bank run is never more difficult than pulling your phone out of your pocket.

A traditional bank is only open during regular business hours and closed on federal holidays. Lots of traditional banks and credit unions do not offer online services, but with an online bank, you can complete all your most important financial transactions anytime. Transfers go through almost immediately, and it’s easier to monitor an online bank account for fraudulent or suspicious activity. The main disadvantage of online banking is that your access to your account will always be dependent upon a steady internet connection.

Pros and cons of online banking

Advantages of online banking

Whether you are a member of a traditional bank that has some online features, or you have just joined an online-only bank, it’s great to know and take advantage of the benefits online banking offers.

  • Better interest earning and lower fees. Online banks don’t have to spend money on physical locations, so they typically have lower fees and higher interest rates on checking and savings accounts. A common traditional savings account interest rate is 0.01 percent APY. Many online accounts have 1.50 percent APY. That’s 150x more than a traditional account!
  • 24/7 access. With an online bank, it doesn’t matter what time it is or if it’s a holiday—your account is fully accessible. You’ll also never have to wait in line. Mobile apps that allow access to your bank information make it easy to keep on track of things wherever you go. You can view recent transactions and transfer money between accounts.
  • Online bill pay. Online bill pay is a great tool available at many traditional banks in addition to online-only banks. Paying bills has never been easier than with automated bill pay.
  • Extensive ATM networks. Most online banks have paired with an ATM network to allow fee-free access to thousands of ATMs.
  • App syncing. Several apps from online banks will also sync with other money apps or financial apps, meaning tracking your budget or paying your friends or family is that much easier.

Disadvantages of online banking

Online banking definitely has a strong list of pros, but like all things in life, it has its drawbacks. Some disadvantages of online banking include the inability to make cash deposits, lack of in-person communication and security risks.

  • No cash deposits. Many online-only banks don’t have cash deposit capability. Some do, but the process can be cumbersome and discourages users from depositing cash.
  • Lack of in-person communication. While online banks offer help through customer service lines, in-app messaging and social media, face-to-face interactions are necessarily limited.
  • Security risks. Bank accounts online are vulnerable to the threats of hacking, malware and phishing. Even though online banking uses encryption software and other security measures to protect personal information, there will always be a risk to online banking.
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Profile picture of Tom Rains
Tom Rains ConsumerAffairs Research Team

Tom Rains graduated from the University of Oklahoma in 2014 with a master’s degree in Professional Writing. Tom’s passion for delivering quality content fuels him to provide consumers with accurate, well-researched information on major life purchases.