Online banks let you do everything online, including opening a new account. With a good online bank, it’s usually possible to have an account open in minutes. Every online bank is different, of course, but the good ones don’t put any unnecessary barriers in your way.
The following is a step-by-step guide to opening an online bank account.
Step #1. Compare Online Banks
Before opening an online bank account, decide which bank. Some online banks offer checking accounts, some offer savings products, and some offer both. Many online banks offer access to personal loans, home loans, and other lending products. The best online banks have a mobile app, enabling you to do all your banking from your smartphone. Read our article on “How to Choose the Right Online Bank” to find out the top 8 things to compare. See the table at the bottom of this article for a comparison of the best online banks.
Step #2. Choose Account Type
On the website of your chosen online bank, you’ll find sign-up options for each account type. Choose your preferred account type and follow the prompts to the online registration form.
Step #3. Fill Out the Application
Filling out an application form to an online bank is generally quick and easy. You’ll be required to enter your name, home address, phone number, and email address. Usually, to open an account with an American online bank, you must be a US citizen or resident alien, and you must be at least 18 years old. In order to verify that you are who you say you are, your bank will ask you to upload a valid driver’s license or state ID and your Social Security number. It may also ask for details about your employment, such as occupation, employer name, and level of income. You might want to have your phone with you in case the process involves typing in a verification code.
Step #4. Verify That Your Information is Correct
Before hitting the submit button, look over the form to make sure you entered everything correctly. Any mistakes could delay your application, so double check to see that your name, address, and contact details are all written correctly.
Step #5. Wait a Few Seconds
After submitting your application, it can take a few seconds to get approved. Be patient and don’t refresh the screen as this could result in the same information being submitted twice, or not at all. If you find yourself waiting more than a couple of minutes without a result: first, check your internet connection to make sure there are no issues at your end; then, contact customer support by live chat or phone. Your bank may run a soft credit check before approving you. If the bank rejects your application, it may ask you to provide additional documentation or to go to a physical branch (if the bank has one).
Step #6. Make a First Deposit
Some online banks require a minimum deposit as a condition of joining, while others don’t require one at all. If there is a minimum deposit, you won’t get full access to your new online bank account without first depositing these funds. If you’re opening a savings account, you obviously won’t start earning interest until you deposit money in the account. To avoid delays, have your credit card or debit card with you or be ready to transfer money in from an existing bank account. Your new bank may ask for your external bank name, routing number, and account number for verification. Depending how you make the first deposit, it can take a few days for the funds to arrive in your new account.
Comparison of Top Online Banks
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Step #7. Congratulations on Opening Your New Account
Opening a bank account online is quicker and easier than opening one the old way. In days gone by, you would have actually had to go to a physical bank branch to open a bank account. You would have waited in line, answered dozens of questions, and walked away with a stack of paperwork. With online banks, you get an account without the waiting times and without the paperwork.