Best Online Banks

Michael Dinich

The banking industry has undergone a revolution in the last few years in which online banks have replaced traditional brick-and-mortar banks. Online banks offer all the same features as traditional banks, but with more convenience, lower fees, and innovative features. Unless you genuinely enjoy waiting in line to speak 1-on-1 with a teller, now is the time to deposit your money in an online bank.

With dozens of great online banks to choose from, it can be hard figuring out the best one for you. To assist you in your decision, we went out and selected the 10 best online banks. These online banks stood out from the crowd for a variety of reasons, including lower fees, higher APYs, innovative features, quick registration, and ease of use.

These are the best online banks we tested and ranked:

1. Best for hybrid banking: BBVA

2. Best for high-interest savings: Barclays US

3. Best for cashback: Discover

4. Best for easy-access savings: American Express

5. Best for automatic savings: Chime Bank

6. Best for full service banking: Chase

7. Best for mobile banking: SoFi Money

8. Best for fee-free banking: CIT Bank

9. Best for budgeting: Empower

10. Best for rewards checking: Radius Bank

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The Best Online Banks: An In-Depth Look

  • 1

    BBVA

    Checking and savings with virtually zero fees
    BBVA
    • Fees$0-$25 per month
    • 24-hour customer serviceNo
    • Maximum APY0.80%

    BBVA is a great example of a hybrid online, mobile, and physical bank. It is one of the 30 largest banks in America, with branches in 7 states (Alabama, Arizona, California, Colorado, Florida, New Mexico, Texas) and a highly acclaimed digital platform for residents of all 50 states. It also has an award-winning mobile app packed full of features, including personal finance tools to help you manage your money and achieve savings goals.

    All BBVA’s customers pay the same low fees and get access to the same features as in-branch customers. The basic standard online checking account has no fees. The premium checking account—which earns you 0.05% interest and rewards from BBVA partners—also has no fees if you’re a student, serve in the military, or meet the $4,000 minimum balance requirements. In addition to checking, BBVA also offers a range of savings accounts, money market accounts, and certificate of deposits (CDs) accounts. In addition, it offers access to low-interest mortgages, loans, and credit cards.

    Pros
    • No fees for students, military
    • Free withdrawals at 64,000 ATMs
    • Full-feature mobile app
    Cons
    • Branches only located in 7 states
    • Below-average APYs
    Read BBVA Review
  • 2

    Barclays US

    High-interest savings on sleek digital platform
    Barclays US
    • FeesExcessive transaction, insufficient funds, etc
    • 24-hour customer serviceYes
    • Maximum APY1.50%

    Barclays is one of the oldest and most respected names in banking, with roots going back to 17th century England. Interestingly, the Barclays US online banking platform is tailor-made for the 21st century. It offers a sleek-looking website, virtually no fees, and very generous APYs. Best of all, there are no minimum balance requirements to open a savings account or qualify for interest.

    Barclays US only offers online savings accounts and online CDs, with no checking. Its one-size-fits-all savings account comes with a 1.50% APY, 18x higher than the national average. Its CDs go as high as 1.75%. Barclays US has designed its savings accounts to be easy to use and to help you save. It offers unlimited online transfers to and from other banks, direct deposits into your savings account, and secure online access to your funds on a 24/7 basis. 

    Pros
    • No monthly maintenance fees
    • No minimum balance requirements
    • Interest compounds daily – earning you more
    Cons
    • No checking accounts
    • No ATM withdrawals
    Read Barclays US Review
  • 3

    Discover

    Generous cashback and rewards
    Discover
    • Fees$0 - no monthly fees except for outgoing wire transfers
    • 24-hour customer serviceYes
    • Maximum APY1.50%

    Discover is best-known for its credit cards, which come with generous cashback and low introductory rates. As it happens, Discover also has an online banking platform with a full range of account options and no monthly maintenance fees. From checking to high-interest savings to CDs to debit cards with cashback, Discover’s online banking platform has it all. What’s more, Discover has a sleek mobile app that lets you take a range of actions, e.g. temporarily freeze a lost debit card, locate a no-fee ATM near you.

    With Discover online banking, you have the option of opening a single account or creating a hybrid checking-savings account. The checking account comes with a free debit card and 1% cashback on up to $3,000 in purchases each month. The savings account comes with a fixed 1.5% APY (regardless of balance), which is about 18x better than the national average. There are also generous CDs and money market accounts on offer.

    Pros
    • 1% Cashback on debit card purchases
    • Free tools to guide you to best account
    • User-friendly mobile app
    Cons
    • No interest earned on checking
    • Only one physical branch location
    Read Discover Review
  • 4

    American Express

    High-interest savings with easy access to funds
    American Express
    • FeesNo fees
    • 24-hour customer serviceYes
    • Maximum APY1.60%

    American Express is our second example of a major credit card company that also offers online banking. In Amex’s case, it offers one online banking product only: a high-interest savings account. Although American Express doesn’t offer checking, the high APYs and ease of access to funds make the savings account worth your consideration. Amex also offers a range of CDs; these guarantee you a higher APY in exchange for parking your money for a fixed period of time.

    The first thing you need to know about the American Express online savings account is it comes with one of the best APYs on the market: 1.6%. The second thing to know is it comes with no obligations—that means no fees and no minimum balance. Finally, it’s also worth noting how easy the Amex savings account is to use. You can link your savings account to up to 3 external bank accounts and make up to 6 withdrawals each month—with funds available 24/7.

    Pros
    • 24/7 access to funds
    • Up to 6 withdrawals per month
    • Free savings tools
    Cons
    • No checking accounts
    • Not linked to a debit card
    Read American Express Review
  • 5

    Chime Bank

    Checking account that pays you for spending
    Chime Bank
    • FeesNone
    • 24-hour customer serviceNo
    • Maximum APYN/A

    Chime Bank is an online/mobile banking platform for the digital age. Forget all those traditional banking concepts like annual percentage yields and minimum balances. Chime Bank has devised a unique way of banking that revolves around a hybrid checking-savings account where you get paid for spending activity.

    Here’s how it works: when you open a Chime Spending Account, you receive a free Debit Visa Card that gets linked to your account. Whenever you spend, Chime automatically rounds up the amount and deposits the difference in your Chime Savings Account. For example, if you buy a coffee for $4.55, Chime rounds it up to $5 and pops the extra 45 cents in your savings account. This way, you grow your savings automatically—with no limits to how much you can save.

    Pros
    • Pays your salary early with direct deposit
    • Zero-fee overdraft (up to $100)
    • Daily alerts and notifications
    Cons
    • No fixed savings
    • Lack of other features
    Read Chime Bank Review
  • 6

    Chase

    Big Four bank with superb digital platform
    Chase
    • Fees$0-$25 per month
    • 24-hour customer serviceYes
    • Maximum APY0.05%

    Although primarily a brick-and-mortar bank, Chase makes this list because of its excellent online banking platform. Known as one of the “Big Four” banks, Chase offers its digital customers access to a full suite of banking products. This includes full-service checking accounts, savings accounts, CDs, and credit cards, as well as a range of loans, investing tools, and business banking tools.

    Chase lets you open a checking or savings account online, with no need to go into a branch. Once you have an account, you can use it for things like paying bills, sending and receiving money (with just a mobile number or email address), securely depositing checks, and automatically depositing paychecks. If you prefer to do some things at a physical location, the good news is Chase has an extensive network of branches and ATMs around the country. 

    Pros
    • Full suite of banking products
    • Lets you send money by mobile or email
    • Refer-a-friend bonus
    Cons
    • Low APYs on savings accounts
    • Not strictly an online bank
    Read Chase Review
  • 7

    SoFi Money

    Mobile-first cash management account
    SoFi Money
    • FeesNo fees
    • 24-hour customer serviceNo
    • Maximum APY0.20%

    Of all the online banks on this list, SoFi Money is probably the most unique. As a mobile-first bank, it is designed for people with smartphones; the website is very basic and is really only there to provide information. As a cash management account, it offers the same convenience as a checking account—but with higher interest. A cash management account is really just a fancy name for a brokerage account where you can manage your cash, make payments, and earn some interest.

    What really makes SoFi Money stand out is its rewards scheme. Each time you spend, you get cashback deposited straight back into your account. Additionally, all SoFi Money members automatically get access to exclusive member benefits like events, experiences, career services, third-party discounts, and financial planning tools. Lastly, SoFi Money is part of the SoFi network of banking services, which includes home loans, personal loans, and student loan refinancing.

    Pros
    • Takes 60 seconds to sign up
    • Full-service mobile app
    • Exclusive member benefits
    Cons
    • Doesn’t offer traditional checking or savings
    • Not suitable for long-term savings
    Read SoFi Money Review
  • 8

    CIT Bank

    Savings plans to suit different lifestyles
    CIT Bank
    • FeesNo monthly fees
    • 24-hour customer serviceNo
    • Maximum APY1.70%

    CIT Bank is an online bank offering savings accounts, money market accounts, checking accounts and certificates of deposit. It is owned by CIT Group, a major financial services company. As a native online bank, CIT Bank spends very little money on overhead, allowing it to pass on savings to customers through virtually zero fees and extremely generous APYs. CIT Bank’s maximum APY of 1.70% is among the best savings rates on the market.

    With CIT Bank, you get 2 ways to save money. The first is the Monthly Savers account, which offers 1.15% APY and no minimum requirements aside from a $100 minimum to open an account. The second option is High Balance Savers, which offers a market-beating 1.70% APY. You’ll need to maintain a balance of at least $25k or deposit $100 into your account each month to qualify for the highest rate.

    Pros
    • Offers very high APYs
    • Lets you send money by mobile or email
    • Wide range of CDs
    Cons
    • No 24 hour customer service
    • $100 minimum opening balance
    Read CIT Bank Review
  • 9

    Empower

    Mobile banking app for saving money
    Empower
    • Fees$6 per month
    • 24-hour customer serviceNo
    • Maximum APY0.25%¹

    As its name suggests, Empower is a mobile banking app that empowers its users to save money. It achieves this with 5 features: a high-interest checking account, automated savings account, personalized financial advice, a simplified tool for managing bills, and a tool that helps you budget and track spending.

    Empower essentially gives you a financial expert in your pocket. The thing we like most is the bill management tool, which helps you track all your bills and cancel any you no longer want. Empower gets really involved in your finances, to the point of negotiating on your behalf to lower your spending. Users who opt in to this feature save $444 a year on average across their cable and phone bills.

    1 Banking services for new accounts provided by nbkc bank, Member FDIC. 0.25% Annual Percentage Yield (APY) may change at any time. APY as of March 19, 2020. Empower charges an auto-recurring subscription fee of $6 for access to the full suite of money management features offered on the platform after your first 30 days.

    Pros
    • Smart recommendations
    • Helps you work toward savings goals
    • 100% mobile platform
    Cons
    • Requires iOS 9.0+ or Android 5.1+
    • Not for use on desktop
    Read Empower Review
  • 10

    Radius Bank

    Checking and savings with cashback
    Radius Bank
    • Fees$0-$10 per month
    • 24-hour customer serviceNo
    • Maximum APY0.25%

    Radius Bank is a full-service online bank that matches the big brick-and-mortar banks for products and beats them (slightly) on rates. It offers a choice of checking account, savings account, and certificates of deposit. It also has a range of other banking products such as credit cards, personal loans, and student loans.

    The APYs here are lower than at other online banks, although that’s not the only reason to consider Radius Bank. The checking account comes with a debit card that earns you 1% cashback on most purchases. Add this to the fact that Radius Bank covers all ATM fees around the globe—and you can see that Radius deserves its place in our list of top 10 online banks.

    Pros
    • 1% cashback on most purchases
    • No ATM fees – ever
    • No monthly fees or balance requirements
    Cons
    • APYs are fairly average
    • $25k minimum balance for max APY
    Read Radius Bank Review

What Is an Online Bank?

By definition, an online bank is a bank where you manage your account exclusively on your computer or mobile device. These days, most of the big traditional banks offer online banking platforms. But online banks go that extra mile, stripping out brick-and-mortar branches altogether and allowing you to do all your banking online.

The one exception to doing things online is ATM withdrawals. Obviously, there’s no way to make an ATM withdrawal without going to a physical terminal. Thankfully, online banks let you withdraw money from ATMs. In fact, the best online banks offer free withdrawals from tens of thousands of ATMs in their network.

How Online Banks Work

When we say online banks let you do everything online, we really do mean everything. Firstly, online banks allow you to sign up online, with no need to go into a physical branch or speak to a customer support rep over the phone. Then, once you’ve signed up, you can do everything from the comfort of your own home. This includes:

  • Viewing balances

  • Downloading statements

  • Transferring money between accounts

  • Opening new accounts

  • Sending and receiving money

  • Setting up automatic bill payments

  • Depositing checks

  • Applying for additional products, e.g. credit card, personal loan

Is Online Banking Safe?

In principle, online banks are just as safe as traditional banks. When it comes to security, your bank needs to do 2 basic things: protect your personal data; and insure your deposits with the Federal Deposit Insurance Corporation (FDIC) for up to $250,000.

The best online banks do the following to protect your data:

  • Use the highest level of SSL technology to encrypt your data

  • Regularly monitor your account and account activities for possible fraudulent activities

  • Send you instant alerts when suspicious activity is observed in your account

  • Make you go through 2-layer authentication to log in to your account

  • Some banks offer ID theft protection as part of their banking service or as an add-on

What Advantages Does an Online Bank Have?

Unless you genuinely enjoy standing in line to speak to a teller, there is no good reason to stay with a traditional bank. Online banks are better than traditional banks in virtually every way. They offer greater convenience, lower fees, and more features—while still retaining all the essential functions of regular brick-and-mortar banks.

Here are the top 5 reasons to use an online bank:

  • Convenience: Online banks let you manage everything from your computer or mobile device, with no need to ever walk into a branch

  • Lower fees: Because they don’t have physical branches, online banks spend less on overhead—and they usually pass on savings to customers in the form of lower fees

  • Better APYs and rewards schemes: Again, because they have less overhead, online banks are often able to offer better rates than traditional banks

  • Unique features: The best online banks are at the cutting-edge of technology and innovation, enabling them to offer unique features that traditional banks would never dream of

  • 24/7 account access: Gone are the days when you could only manage your account or access funds during opening hours. Thanks to online banking, now you can bank 24/7, 365 days a year

Michael Dinich
Michael has worked in personal finance for over 20 years, helping families reduce taxes, increase their income, pay down debt and save for retirement. Michael is passionate about personal finance, saving money, and all things geeky.