One thing has become increasingly clear in the personal finance industry: Online banks are on the rise.
In recent years, online banks are gaining a ton of traction by offering higher interest rates and low fee schedules compared to big national banks.
And the more that account holders become comfortable saying goodbye to traditional brick-and-mortar banks, the more attractive online banks become.
In this post, we examine the best online banks, along with the advantages and disadvantages of choosing one compared to a traditional brick-and-mortar bank.
14 Best Online Banks of 2023
Here are the top online banks in the U.S. you can open an account with today:
- Discover Bank: Best Overall
- Axos Bank: Best Checking APY
- Capital One: Best Customer Satisfaction
- Ally Bank: Best For CDs
- TIAA: Best for Yield Pledge
- Varo Bank: Best For New and Underbanked
- UFB Direct: Best For Savings APY
- Quontic: Best for Low Fees
- Wealthfront: Best For Investors
- nbkc: Best All-In-One Account
- CIT Bank: Best Money Market Account
- Charles Schwab: Best For Travelers and HNWI
- LendingClub: Best Finance Tools
- SoFi: Best One-Stop Shop
Best Overall
1. Discover Bank
Products
Checking, Savings, MMA, CDs
Fees
No monthly, overdraft or ATM
Interest Rates
1% Cash Back Checking; 4.30% on Online Savings
ATMs
60,000
Discover Bank is the online-only banking division of Discover Financial.
Along with Visa, American Express, and Mastercard, Discover is one of the world’s largest credit card brands, with over 57 million cardholders in the U.S.
While not as well known for its online banking products, Discover is one of the best overall.
Why we like it
Discover is a formidable online banking option.
The Discover Rewards Checking account offers 1% cashback on all debit card purchases, up to $3,000 in purchases each month. Discover savings accounts, money market, and certificate of deposit (CD) options all come with respectable interest rates.
But with all of that said, the thing that sets Discover apart is its commitment to a truly fee-free banking platform.
All of the fees that you’ll see with traditional banks, such as monthly service fees on checking accounts and savings accounts, are nowhere to be found with Discover. The bank also doesn’t charge for official bank checks, check orders, or replacing debit cards.
Things to watch out for
- Savers won’t get as much out of Discover’s free checking account as those who actively use their debit card, since the account opts for cash back instead of an annual percentage yield (APY)
- Discover doesn’t offer home or auto loans, so your banking relationship can’t help you when it comes time for big purchases
- No reimbursements for out-of-network ATM withdrawals
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: 730 (2nd place)
- BBB Grade: A+
- Apple iOS: 4.9 based on 4.19M ratings
- Google Play: 4.6 based on 283k ratings
Learn More:
Best Checking APY
2. Axos Bank
Products
Checking, Savings, MMA, CDs, Mortgages
Fees
No monthly, overdraft or ATM
Interest Rates
up to 3.30% APY on Rewards Checking; up to 0.61% APY on High-Yield Savings
ATMs
91,000
Axos Bank, formerly known as Bank of Internet USA, is an online-only bank based out of San Diego, California.
Axos was originally founded in 1999 and offers online bank accounts, personal loans, and an investment platform.
Why we like it
Axos has some of the best interest rates in the industry, especially when it comes to checking.
Axos Rewards Checking earns an APY of up to 3.30% if you meet four requirements.
First, to be eligible for interest at all, you’ll need to receive direct deposits totaling $1,500.
Then, you can receive APY boosts by completing additional requirements, such as making at least ten debit card purchases of $3 or more each month, maintaining a $2,500 minimum balance in an Axos investing account, and paying on a consumer loan.
If you do those things, you’ll be rewarded with one of the best checking account APYs that you can find.
The interest rates for savings accounts are similarly competitive.
Things to watch out for
- You’ll need to jump through hoops to earn the highest checking rates
- Axos charges foreign transaction fees, unlike competitors on this list
- Low rates on CDs
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: 607
- BBB Grade: A+
- Apple iOS: 4.7 based on 12k ratings
- Google Play: 4.5 based on 5k ratings
Learn More:
Best Customer Satisfaction
3. Capital One 360
Products
Checking, Savings, MMA, CDs
Fees
No monthly; no overdraft; no ATM reimbursement
Interest Rates
4.30% HYSA; 0.10% Checking
ATMs
70,000
Capital One Bank is the fifth-largest consumer bank and the eighth-largest financial institution in the U.S.
As an online bank competitor, Capital One is a nice balance – a well-established online presence coupled with over 750 physical locations.
You can expect to find competitive interest rates and a nice variety of products and services.
Why we like it
In the 2023 J.D. Power U.S. Direct Banking Satisfaction Study, Capital One ranked in the top five banks in the nation for customer satisfaction.
Contributing factors were low fees that are structured clearly, high APYs, and a user-friendly online banking experience.
There are a range of dedicated customer support lines, a virtual assistant, and a lot of useful online resources for troubleshooting your account. Capital One also has one of the highest-rated mobile apps in the industry, with glowing ratings from iOS and Android users.
Overall, Capital One offers a solid banking platform with numerous account options, respectable rates, and a wide variety of credit cards and investment products.
Things to watch out for
- No out-of-network ATM fee reimbursements
- Mediocre CD rates
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: 716
- BBB Grade: A+
- Apple iOS: 4.9 based on 7.5M ratings
- Google Play: 4.6 based on 1.4M ratings
Learn More:
Best for CDs
4. Ally Bank
Products
Checking, Savings, MMA, CDs, Mortgages, Credit Cards
Fees
No monthly or overdraft fees; $10 ATM reimbursements
Interest Rates
0% on Interest Checking; 4.25% APY on Online Savings; Up to 4.75% APY on CDs
ATMs
43,000
Ally Bank is quite possibly the most well-known online-only bank in the U.S.
The bank started out as a division of General Motors, helping car dealers finance and maintain inventory.
Today, still headquartered in Detroit, Ally is now the 23rd largest bank in the country in terms of total assets.
Why we like it
By all standards, Ally is an industry leader in the online banking world.
It consistently earns high customer satisfaction scores, with one contributing factor being its 24/7 phone support.
Plus, the bank’s competitive rates and nearly non-existent fee schedule are worth considering.
All of Ally’s account options are top contenders, but the rate on CDs stands out the most. And Ally guarantees that if CD rates go up within 10 days after funding your account, the bank will honor the higher rate and adjust yours going forward.
We also like that, unlike many other online banks in this list, its product breadth makes it easy to bank all in one place. Ally has all of the traditional banking products, along with home, auto, and personal loans, retirement accounts, and brokerage services.
Things to watch out for
- Ally’s rates, while competitive, aren’t the absolute highest
- Ally imposes a 1% foreign transaction fee
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: 729
- BBB Grade: A
- Apple iOS: 4.7 based on 63k ratings
- Google Play: 3.6 based on 25k ratings
Learn More:
Best for Yield Pledge
5. TIAA
Products
Checking, Savings, MMA, CDs, Investment Accounts
Fees
No monthly or overdraft fees; $15 ATM reimbursements
Interest Rates
4.50% into APY on savings; 0.25% APY on checking
ATMs
80,000
TIAA Bank is a Fortune 500 that was founded in 1918 to provide financial products for teachers.
Headquartered in New York, the full-service bank has a string of locations across 45 states but primarily serves customers through its top-tier online banking platform.
Why we like it
TIAA stands out for its yield pledge, which promises that each of its deposit accounts’ APYs is among the rates offered by the top 5% of the largest banks in the industry.
To achieve this promise, the bank monitors and adjusts rates on a monthly basis.
Its deposit accounts have no monthly fees, and you can enjoy features like mobile deposits and $15 of ATM reimbursements with TIAA’s Yield Pledge Checking Account.
The Yield Pledge Online Savings account is a great option for earning interest with no strings attached, with no monthly fees, minimum deposit requirements, or interest tiers.
TIAA’s CD lineup is also worth considering, with a Basic CD, Bump Rate CD, and an IntraFi CD that increases FDIC insurance to cover multi-million dollar deposits.
Things to watch out for
- No cash deposits
- Despite its yield pledge, rates aren’t the highest in the industry
- Yield Pledge Checking requires a $100 opening deposit
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: N/A
- BBB Grade: A+
- Apple iOS: 4.7 based on 7.3k ratings
- Google Play: 4.4 based on 5.59k ratings
Learn More:
Best For New and Underbanked
6. Varo Bank
Products
Checking, Savings, Credit Builder
Fees
No monthly, overdraft; no ATM reimbursements
Interest Rates
up to 5.00% APY on your savings
ATMs
55,000
Varo Bank is an online-only bank based out of San Francisco.
Founded in 2015, Varo’s initial goal was to serve as an alternative banking option for millennials, who were becoming increasingly disillusioned with traditional banking. In that light, Varo offers 100% of its banking services through an easy-to-use mobile app.
Why we like it
It’s hard for savers not to like Varo Bank’s interest rates.
The standard APY on Varo’s HYSA is 3.00%, making it one of the highest in this post. On top of that, Varo also offers a massive bonus APY of up to 5.00% for balances up to $5,000, if you meet the following qualifying activities:
- Receive direct deposits of $1,000 or more each month
- End the month with a positive balance in your Varo Bank Account and Savings Account
If you do those things, the higher APY is yours.
Additionally, Varo offers automated savings features similar to Chime: Save Your Pay and Save Your Change.
Things to watch out for
- The higher APY is limited to just $5k worth of savings
- Varo will charge $3.00 every time you use an out-of-network ATM
- Varo has partnered with Green Dot for cash deposits, which may charge fees
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: N/A
- BBB Grade: A
- Apple iOS: 4.9 based on 156k ratings
- Google Play: 4.7 based on 188k ratings
Learn More:
Best For Savings APY
7. UFB Direct
Products
HYSA, MMA, Mortgages
Fees
$10 monthly for the MMA, unless you maintain a balance of $5,000 or more
Interest Rates
5.25% APY on your savings and MMA
ATMs
91,000+
UFB Direct, a growing division of Axos Bank, is an online bank that offers mortgage loans, high-yield savings accounts, and money market accounts.
UFB’s competitive interest rates are what set it apart from its competition.
Why we like it
If high interest is important to you, you’ll be hard-pressed to find a bank that offers greater rates.
UFB also has a modern user interface on its app compared to traditional banks.
Although it’s a fairly new fintech, UFB is backed by Axos Bank (member FDIC) which has been around for nearly 25 years.
Things to watch out for
- Account options are limited to a High Yield Savings and Money Market accounts and a recently launched mortgage division (which is more than most fintechs)
- MMA monthly fee requires a $5,000 balance to waive
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: N/A
- BBB Grade: A+
- Apple iOS: 4.8 based on 4.2k ratings
- Google Play: 4.7 based on 1.2k ratings
Learn More:
Best for Low Fees
8. Quontic Bank
Products
Checking, Savings, MMA, CDs, Mortgages
Fees
No monthly fees, overdraft fees, or ATM fees
Interest Rates
1.10% High Interest Checking, 4.50% HYSA
ATMs
90,000
Quontic Bank started as a community bank in 2009, and still operates a few branches in New York City.
Nationwide, however, its footprint is entirely online and it’s grown to managing $1B in assets.
Why we like it
Quontic offers a rewards checking account that earns 1% cashback on debit card purchases.
There’s also an interest-bearing checking account that yields a 1.10% APY when you make 10 qualifying debit card purchases of at least $10 per month.
Quontic’s HYSA earns a competitive 4.50% APY, with a $100 minimum opening deposit.
We’re fans of Quontic’s low-fee structure. There are no account fees, overdraft fees, or NSF fees.
Things to watch out for
- Because Quontic didn’t start out as an online bank its tech lacks the shine and innovative features compared to some competitors
- Mixed app ratings
- The Bitcoin Rewards Checking account has been discontinued
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: N/A
- BBB Grade: A+
- Apple iOS: 4.4 based on 521 ratings
- Google Play: 3.3 based on 164 ratings
Learn More:
Best For Investors
9. Wealthfront
Products
Cash Account
Fees
No monthly, overdraft; some ATM
Interest Rates
4.80% APY
ATMs
19,000
Wealthfront is a fast-growing fintech company that offers investment accounts, robo advisor services, personal loans, and cash accounts with checking and savings features.
Headquartered in Silicon Valley, Wealthfront is a unique member of this list because the company uses proprietary automation technology.
Why we like it
Wealthfront is an innovative fintech company that offers advanced investing and budgeting tools. If you don’t need physical branch access and want to keep both your investment accounts and everyday bank account in one place, Wealthfront is an appealing option.
You’ll earn an impressive APY from your checking account deposits, and you can easily move money around into higher-earning investment accounts. Or, if you prefer to let Wealthfront’s robo advisor maximize your returns.
It can also pay bills, set aside cash for an emergency fund, and make additional investments.
With cutting-edge tech that is relentlessly focused on making account holders as much money as possible, there’s a ton of overall growth potential for your funds, compared to traditional banking options.
Other nice perks are the $1 million in FDIC insurance and up to 2 days early pay with direct deposit.
Things to watch out for
- Poor BBB rating
- A steep 2.75% foreign transaction fee
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: N/A
- BBB Grade: F
- Apple iOS: 4.8 based on 16k ratings
- Google Play: 4.7 based on 5.2k ratings
Learn More:
Best All-In-One Account
10. nbkc
Products
Checking, Savings, MMA, CDs, Mortgages
Fees
No monthly, overdraft or ATM
Interest Rates
1.50% APY Everything Account
ATMs
37,000
NBKC Bank is a growing online bank that offers bank accounts, loans, and credit cards for consumers and small businesses.
Formerly known as the National Bank of Kansas City, NBKC still operates a handful of brick-and-mortar branches.
Why we like it
nbkc takes a unique approach to personal banking by combining checking and savings into one account, which is called the nbkc Everything Account. Basically, you get all the practicality and flexibility of a checking account, coupled with the interest-earning potential of an HYSA.
The nbkc Everything Account has no minimum account balance, no overdraft fees, no maintenance fees, and no foreign transaction fees.
You’ll also get access to features like automatic bill pay and savings goals to stay on track, and nbkc’s Financial Snapshot provides a comprehensive overview of your financial picture with linked accounts, credit cards, loans, and investments.
The interest rate, however, has definitely been more competitive in the past.
Things to watch out for
- Other banks and credit unions offer higher rates
- Having your savings intermixed with your regular checking account can make it easy for some people to overspend; take advantage of their savings goals to keep yourself accountable
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: N/A
- BBB Grade: A+
- Apple iOS: 4.4 based on 752 ratings
- Google Play: 4.1 based on 493 ratings
Learn More:
Best Money Market Account
11. CIT Bank
Products
Checking, Savings, MMA, CDs, Mortgages
Fees
No monthly; no overdraft; $30 ATM reimbursements
Interest Rates
up to 0.25% APY on eChecking; up to 1.00% APY on Savings Builder
ATMs
None
CIT Bank is a top 50 online bank in the U.S. that was founded in 2000 as the online-only banking platform of the CIT Group.
The firm also owns and operates OneWest bank locations in California, but its primary function is the online platform.
Why we like it
CIT Bank is a top-rated online bank across the board.
The product selection is lean, so you don’t have to spend time weighing your options.
Each account comes with a respectable APY, but the CIT Money Market account boasts the bank’s highest APY – with no limit on how much you can deposit.
Things to watch out for
- Mixed ratings on the app
- Limited customer support hours compared to competitors that offer 24/7 live help
- No paper checks for the eChecking account
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: 686
- BBB Grade: A-
- Apple iOS: 4.6 based on 10k ratings
- Google Play: 3 based on 2.8k ratings
Learn More:
Best For Travelers and High-Net-Worth Individuals
12. Charles Schwab
Products
Checking, Savings, Mortgages
Fees
No monthly, overdraft or ATM
Interest Rates
0.45% Checking; 0.48% Savings
ATMs
None, but offers unlimited ATM fee rebates worldwide
Charles Schwab Bank is the online banking subsidiary of the Charles Schwab Corporation (more commonly referred to as Schwab).
The banking platform offers checking and savings accounts and is built to operate seamlessly with your investing experience.
Why we like it
Charles Schwab has won the J.D. Power Direct Banking Satisfaction Study for several years in a row.
While Schwab’s rates knock it low on this list, if you’re a frequent traveler and an investor with a Schwab One brokerage account, its banking products are definitely worth checking out.
There are no service fees or account minimums, no foreign transaction fees, and the bank offers unlimited ATM fee reimbursements worldwide.
Those with large investment portfolios will also find Schwab’s Pledged Asset Line® a convenient way to borrow, without disrupting your investing strategy. You can use this non-purpose line of credit for anything from a new home purchase, tuition, new business startup, and more – for as low as sub-2%.
Things to watch out for
- Uncompetitive rates
- The mobile app gets less-than-stellar reviews from Android users
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: 732 (first place)
- BBB Grade: A+
- Apple iOS: 4.8 based on 673k ratings
- Google Play: 3.2 based on 24k ratings
Learn More:
Best Finance Tools
13. Lending Club
Products
Checking, Savings, CDs, MMA, Loans
Fees
No monthly, overdraft or ATM fees
Interest Rates
1% cash back on Rewards Checking; 4.50% APY on High-Yield Savings
ATMs
37,000
LendingClub is popular for its loans, but it’s also a full-service bank with a handful of rewarding deposit accounts.
Since it acquired Radius Bank in 2021, LendingClub has positioned itself as one of the top online banks, offering competitive rates on its FDIC-insured accounts.
Why we like it
LendingClub offers competitive interest, minimal fees, and a resourceful mobile app and website.
The High-Yield Savings account earns a 4.50% APY on all balance tiers, with no monthly fees or ongoing minimum balance requirements after you deposit your first $100. You can also make unlimited external transfers.
The Rewards Checking account is also notable. It offers unlimited 1% cashback and ATM rebates, with no monthly fees or overdraft fees.
You also get perks like 2-day early pay with direct deposits and interest on balances over $2,500.
LendingClub stands out for its impressive suite of financial planning tools. The financial toolkit comes with an informative dashboard that displays all your internal and external accounts, debts, net worth, and spending insights. You can use the dashboard to create a budget and custom financial plans.
Things to watch out for
- The interest rate on LendingClub’s checking account is mediocre and only applies to account balances of $2,500 or more
- The minimum deposit requirement for CDs is high at $2,500
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: N/R
- BBB Grade: A
- Apple iOS: 4.4 based on 2.39k ratings
- Google Play: 3.2 based on 1.5k ratings
Best One-Stop Shop
14. SoFi
Products
Checking, Savings, Loans, Insurance, Credit Cards, Investment Accounts
Fees
No monthly or overdraft fees; no ATM reimbursements
Interest Rates
0.50% APY on checking; Up to 4.40% APY on savings
ATMs
55,000
SoFi Bank is a part of SoFi Technologies, a platform that provides an extensive lineup of financial products and member benefits.
It’s a great low-fee option for checking and savings accounts with a wealth of other financial products and services.
Why we like it
SoFi offers customers a solid banking experience on a user-friendly platform. It’s our pick if you’re looking for a one-stop shop for managing all your finances.
With automated and active investing services, insurance products, credit cards, loans, refinancing options, and estate planning services, it offers more services than most banks.
On the deposit account side, you can open a checking and savings account. You’ll earn 4.40% APY on your savings balance if you set up direct deposit, or 1.20% if you don’t.
Checking accounts earn 0.50% APY and come with perks like 2-day early paychecks, fee-free overdraft coverage, cashback at local businesses, and enhanced $2 million FDIC insurance.
New accounts are currently eligible for a sign-up bonus of up to $250.
Things to watch out for
- SoFi doesn’t currently offer CDs
- If you need to make a cash deposit into your SoFi account, there’s a $4.95 fee
Ratings and reviews
- J.D. Power Direct Banking Satisfaction Score: N/R
- BBB Grade: A+
- Apple iOS: 4.8 based on 263k ratings
- Google Play: 4.1 based on 29k ratings
Learn More:
Why Pick an Online Bank Instead of a Traditional Bank?
- Product Offering: Online banks offer many of the same banking products that you can find at traditional banks: checking, high-yield savings accounts, CDs, money market accounts, loans, and credit cards.
- Lower Fees & Higher Rates: However, because online banks don’t have the overhead costs of brick-and-mortar branches, they offer some of the same perks that draw members to a credit union: lower fees and higher rates.
- Sleek Mobile Apps: Additionally, their tech-first focus has driven a lot of innovative features and intuitive, sleek apps that aren’t necessarily seen at the big branch banks.
Lastly, it’s worth noting that direct banks still hold less than 10% of all deposits. That means that big banks have significantly more resources available to continue to evolve and innovate, so you’ll definitely want to continue to monitor what the big brands offer.
Pros and Cons of Online Banks
Many online banks offer really unique features and benefits, and finding one that aligns with your financial needs and values can be a game changer.
Pros of Online Banks
- High rates: Generally, online banks offer the best rates on your savings, though these days the gap isn’t nearly as big as it used to be.
- Lower fees: National chains are known to nickel and dime you with fees: overdraft, card replacement, monthly maintenance fees, and more. As a general rule, online banks in the U.S. will have fewer fees by comparison.
- Easy-to-use digital banking: Online banks depend on your digital banking experience being straightforward and intuitive, so their websites and apps are typically easier to navigate.
Cons of Online Banks
- Depositing cash can be difficult. If you frequently handle cash, you’re likely better off with a bank that has a branch nearby. For one-off deposits, however, many online banks have partnered with retailers.
- No option to seek help at a local branch. While most of the time online banking is the more convenient option, there are situations – particularly problems that aren’t routine – when having the option for in-person help could be more straightforward than navigating yourself or by phone.
- Limited account types. Some online banks like Ally offer a wide array of products, but others are limited to just checking and savings accounts. Even if this isn’t an issue for you right now, it’s something to consider: when it comes time for big purchases like a car or home, it can be nice to have an established banking relationship. This can make it easier to qualify for a loan, or to get a bank’s best rates.
- Fewer signup bonuses. National banks like Chase and Citi offer consistent bank bonuses to new customers. Online banks are, by comparison, more hit or miss.
Online Banks We’ve Considered
Interested in learning about other online banks? Click on any of the banks below to read our full review.
| Bank | Bank | Rating | About | Founded |
|---|---|---|---|---|
|
Ally Invest | 9.0 | Ally Invest is a low-cost, high-performing online brokerage platform for investors of all experience levels. | 2009 |
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UFB Direct | 8.0 | A growing division of Axos Bank, UFB Direct’s competitive interest rates set it apart from the competition. | 2000 |
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Synchrony Bank | 7.0 | If high-yield is what you're after, then you've found a solid option in a Synchrony Bank savings account. As a savings specialist, Synchrony comes to the table with no monthly fees, relatively high APYs, and a user-friendly platform. | 2003 |
 |
Comenity Direct | 9.0 | If you're looking for a straightforward banking experience with more than competitive rates, Comenity Direct will serve you well. | 2018 |
 |
Bluebird By American Express | 9.0 | With Bluebird by American Express, there’s plenty to like. You’ll rarely need to worry about fees, and the card mirrors most of the features of major checking accounts. Plus, you’ll get access to tempting Amex offers without having to pay credit card fees. | |
 |
First Internet Bank | 8.5 | First Internet Bank is easy to use and offers plenty of different account options. Its high-end interest rates are among the best in the business, and it brings everything together with a highly rated mobile app and great customer service. | 1996 |
 |
Vio Bank | 9.0 | If you're looking to save money, diversify your portfolio, or lower your risk, consider Vio Bank. You might find they’re just what you need to reach your personal finance goals and dreams. Most Vio Bank reviews are positive, here’s what I think. | 1911 |
|
TIAA Bank | 9.0 | Overall, there is a lot to like about TIAA Bank. You'll find plenty of account options and most of them come with higher interest rates than the national average. You're also covered with an expansive ATM network and TIAA's mobile app and customer service team seem to be keeping clients happy. | 1918 |
 |
USAA Bank | 9.0 | If you're enlisted or served in the past, USAA Bank could be a great option for you. While it does trend behind in on its savings account interest rates, overall, there is a lot to like. | 1922 |
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Charles Schwab Bank | 9.0 | Overall, Charles Schwab Bank is recommended for those who are already comfortable with Schwab’s investment platform and want all of their deposit and investment accounts in one place. | 1971 |
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Radius Bank | 8.0 | From a tech-forward online banking experience to the account options and customer service of a traditional bank, there's plenty to feel good about with Radius Bank. | 1987 |
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Marcus by Goldman Sachs | 9.0 | Overall, Marcus by Goldman Sachs offers one of the best online banking platforms with a clean, user-friendly interface and high-earning account options. | 1973 |
|
Axos Bank | 8.5 | Competitive APYs on high yield savings accounts, minimal fees, and access to a wide range of financial products, are some compelling reasons to sign up with Axos Bank. | 2000 |
|
Discover Bank | 9.5 | Discover Bank allows you to have all your banking products in one place all with no fees. The bank also offers such competitive rates on savings accounts that it is 5x the National Savings Average. | 1911 |
|
CIT Bank | 8.5 | If you're comfortable with an online-only bank, CIT is a solid choice. Their parent company has been around since 1908, and the bank offers everything you'd expect from online-focused banks: rates the national banks can't compete with, an intuitive digital experience, and a fair fee structure. |
2000 |
|
Ally Bank | 9.5 | Ally is one of our favorite banks. They offer consistently high rates, low fees, and solid products covering your banking and investing needs. They're online-only, which is a driver for their favorable rates and fees, but that can be a deterrent for customers who prefer to have the option of in-person support. | 2009 |
How to Choose the Best Online Bank
With so many options available, it can be overwhelming to navigate through the best online banks and choose the right one for your needs. Here are a few steps you can take to land on the best bank for your needs:
- Research and compare: Start by researching different online banks and comparing their offerings. Look at factors such as fees, interest rates, customer service, and security. Make a list of the banks that stand out to you.
- Read reviews: Reading reviews from other customers can provide valuable insights into a bank’s reliability and user experience. Look for reviews on reputable websites and consider both the positive and negative feedback.
- Check for FDIC insurance: It’s crucial to ensure that the online bank you choose is FDIC insured. This means that your deposits are protected up to $250,000 per depositor, giving you peace of mind in case of any issues.
- Evaluate the mobile app: Since online banking is primarily done through a mobile app, it is important to evaluate the user-friendliness and functionality of the bank’s app. Look for features such as mobile check deposits, easy fund transfers, and financial management tools.
- Consider ATM access: If you frequently need to withdraw cash, make sure the online bank you choose offers convenient ATM access. Some banks have partnerships with fee-free ATM networks, while others reimburse ATM fees incurred at any machine.
- Assess customer service: Good customer service is essential when dealing with any financial institution. Check if the online bank offers 24/7 customer support, multiple contact channels (such as phone, email, and live chat), and a knowledgeable support team.
- Review the fine print: Take the time to carefully read the terms and conditions of the online bank, including any fees and penalties. Look for any hidden charges or restrictions that may impact your banking experience.
- Consider additional services: Some online banks offer additional products like mortgages, credit cards, and investment options. If you foresee the need for these services in the future, it might be beneficial to choose a bank that offers them.
Frequently Asked Questions
What is an online bank?
Online banks are financial institutions that operate entirely (or nearly entirely) on the Internet.
Rather than a traditional banking experience in a local branch, customers interact with internet banks from a computer or mobile device.
This means the ability to deposit checks on your phone, make person-to-person transfers through Zelle®, get custom balance alerts, freeze your debit card, request checks to be sent to pay bills, set up automatic transfers to your savings account, and more.
Are online banks legit?
To put it simply — Yes. Online banks are just as legitimate and safe as traditional brick-and-mortar banks, as long as they are FDIC-insured.
All of the banks in this post are FDIC-insured. And, since these banks operate exclusively online, online bank security tends to be top-notch.
In fact, in some ways, online accounts can be safer than conventional accounts. eStatements and the elimination of paper checks prevent some of the traditional opportunities for fraud.
What is the best online bank?
It all depends on what the best bank experience looks like for you. First, focus on the features that are most important to you. From there, you should be able to pick the best online bank for you based on the above list.
Taking a step back, one of the biggest draws of online-only banks like Ally or CIT is that they don’t carry the overhead costs associated with physical locations and the employees that run them.
As a result, there’s more flexibility when it comes to offering competitive interest rates, charging minimal fees, and a better banking app.
What is the downside of online banks?
The biggest drawback of banking online is the lack of in-person support.
There’s no escaping the fact that you won’t have the option to talk with a representative face-to-face like you would with a local bank or credit union. You also might run into issues locating no-fee ATMs or depositing cash.
That being said, for many people, all that’s needed are some simple financial adjustments. Once you become comfortable with convenient features like online bill pay, mobile check deposit, and Zelle, you won’t miss paper checks. You probably won’t miss commuting across town to visit your local branch, either.
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Are online banks FDIC insured?
Yes, many online banks are FDIC-insured.
In fact, some fintech companies like Wealthfront on this list are partnered with multiple banks on the backend and are therefore able to split your deposits across multiple banks (behind the scenes) to give you significantly more than the typical $250,000 coverage.
Which Online Bank is Best for Your Needs?
As technology continues to evolve, so too will the way you interact with your bank. Traditional banks like Bank of America and Wells Fargo are unlikely to ever go away.
However, the convenient perks of online banking products are becoming increasingly impossible to ignore.
Depositing, transferring, spending, investing, and saving money has never been easier to do on your smartphone.
If you pick the option that makes the most sense for your financial situation, you’ll be well served by any of the online banks above.
Our Methodology
The BankBonus team has analyzed dozens of banks to provide our readers with thoroughly informed and accurate reviews.
We evaluated dozens of online banks to present an accurate recommendation for the best online banks.
Our assessment of each bank factors in these considerations:
- User experience: We carefully consider the ease of use and availability of resources on each bank’s website and factor in reviews of the mobile app from the Apple App Store and Google Play Store.
- Product lineup: We review the types of accounts, loans, and services offered by each bank, as well as the number of accounts.
- Interest: Along with these features, we consider how competitive the bank’s interest-bearing checking, savings, CD, and MMA rates are.
- Fees and pricing: We also consider each institution’s fees, including monthly maintenance fees and other service charges.
- ATM access: To gauge convenience, we look at each bank’s ATM availability and reimbursement policies.
- Brand reputation: The bank accounts we recommend have been carefully vetted to ensure they are legitimate, secure, and backed by FDIC insurance.
- Customer service: In our review process, we also explore their customer service channels, hours of availability, and third-party reviews.
