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5 Best Online Banks in US

May 2024

Based on recent surveys of consumer banking, 70% of Americans prefer using an online banking platform or a mobile app rather than visiting a bank branch. For individuals who don't need in-person banking services, online financial institutions may offer access to competitive interest rates and potentially more account features.

Our Top Choice

Plus500

No monthly fees

SoFi - Best online bank overall

Saving APY up to 4.6%, Checking APY 0.5%

No account fees or minimum balance requirements

Free paper checks

4.6 on Trustpilot with 8k+ reviews

#1

MOST POPULAR

BEST ONLINE BANK 2024

Read more

EXCELLENT

REVIEW

5.0

05/2024

Online Banks vs. Traditional Banks

Choosing between online banks and traditional banks involves weighing several factors based on individual banking needs. Online banks offer the convenience of 24/7 access through digital platforms without the need for physical branches, making them ideal for those comfortable with managing their finances exclusively online. They typically provide higher interest rates and lower fees, with some even offering early access to direct deposit funds. In contrast, traditional banks might be preferable for those who value face-to-face interactions and the physical presence of branches for certain transactions and services. Although they often have higher fees and lower interest rates, traditional banks provide comprehensive customer service, including in-person support, and additional facilities like safe deposit boxes. Security is robust in both, though online banks generally use more advanced security measures.

The Results

Plus500

No monthly fees

SoFi - Best online bank overall

Saving APY up to 4.6%, Checking APY 0.5%

No account fees or minimum balance requirements

Free paper checks

4.6 on Trustpilot with 8k+ reviews

#1

MOST POPULAR

BEST ONLINE BANK 2024

Read more

EXCELLENT

REVIEW

5.0

05/2024

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Built-in budgeting tools for spending and saving

Cash deposits not available

GOOD

REVIEW

4.7

05/2024

No monthly fees

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Cash deposits available at more than 90,000 retailers

No interest earned on checking account

GOOD

REVIEW

4.6

05/2024

No monthly fees

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Competitive APYs on savings, CDs and money market accounts

No interest earned on checking

GOOD

REVIEW

4.3

05/2024

No monthly fees

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Customer service is available seven days a week

80,000+ ATMs nationwide

GOOD

REVIEW

4.2

05/2024

No monthly fees

How To Choose the Best Online Bank

Online-only banks offer convenience, yet they don't all provide the same features and benefits. For example, some do not issue paper checks, which could be a problem if you need to pay a bill via check each month.


To choose the right one for you, begin by listing online banks that carry the financial products you require. Then, evaluate them based on factors like interest rates, monthly fees, and ATM availability.

Some banks have specific criteria that must be met to unlock the best features or rates, such as maintaining a certain minimum balance or setting up monthly direct deposits.


Here are additional tips for comparing online banks:


  • Ensure that deposits are secured by the National Credit Union Administration (NCUA) or the Federal Deposit Insurance Corp. (FDIC), which safeguard balances up to $250,000 per depositor, per bank.

  • Review the security measures for mobile and online banking.

  • Look at reviews to understand what the customer support experience is like.

  • What You’ll Need To open an online account, you'll need to prepare a few things to verify your identity and fund your account:

  • Personal information: You will typically need to provide details like your Social Security number, address, and identification.

  • Device: You will require a device with internet access to apply and use online banking services. Some banks allow applications through their mobile apps or websites.

  • Funding: You will need a funding source for your initial deposit. Many banks allow you to enroll in direct deposit, enabling money transfers to your new account.

  • Services To Consider There are a few additional services you might want to consider when choosing an online bank to tailor your banking experience to your needs and expectations.

  • Checks: If you require paper checks, opt for a bank that offers them, like SoFi or Discover.

  • Cash deposits: Since online banks lack physical branches, options for depositing cash are limited. Some collaborate with third-party networks to accept cash deposits, often for a fee. For instance, SoFi partners with stores like CVS and Dollar General to facilitate cash deposits at the counter.

  • ATM access: Most online banks provide access to a network of thousands of fee-free ATMs, though many charge a fee for using out-of-network ATMs.

  • Customer support: Check customer reviews and the bank’s website to assess the availability and quality of customer support options, including phone, email, and online chat.



Pros and Cons of Online Banking 

Online banking has both advantages and disadvantages compared to traditional banks.


Pros:

  • Convenience: Many banking operations can be performed online or via a mobile app, including depositing checks. Online banks often include features that simplify managing your account through your smartphone or computer.

  • Often lower costs: Online accounts typically don't have monthly maintenance fees or require a minimum deposit or daily balance to maintain your account. If you prefer not to keep a large amount of cash in your accounts and want to avoid accumulating fees, online banking might be a good choice.

  • Potentially higher savings rates: Generally, you’ll earn more on your balance with an online bank that offers high-yield deposit accounts. On our list of the best online banks, many provide APYs ranging from 3.00% to 5.00% for savings accounts, significantly above the national average.


Cons:

  • Sometimes limited cash transactions: Many online banks restrict cash deposits. And if you need to withdraw cash, you’ll likely need to use an in-network ATM to avoid fees.

  • Paper checks may not be available: You might find that your online bank does not offer paper checks and only allows you to pay with your debit card, digital wallet, or a bill-pay feature.

  • May have direct deposit requirements: You might need to enroll in direct deposit to qualify for many of the benefits offered by online banks. Check the eligibility requirements before you apply for an account.

SoFi is more than just a bank—it's an all-in-one financial super app.

SoFi has established itself as a trusted financial hub, with over 8 million people using its comprehensive suite of services. This all-in-one super app not only offers high-yield savings accounts with some of the highest APYs on the market but also provides an extensive range of financial products. Users can access mortgage loans, student loans, and personal loans, all tailored to meet diverse financial needs. SoFi also offers credit cards with competitive rewards, various insurance options, and exclusive travel deals, enhancing its appeal as a multifaceted financial solution. This integration of services makes SoFi an attractive choice for those seeking to consolidate their financial activities into one robust and reliable app

Plus500

No monthly fees

SoFi - Best online bank overall

Saving APY up to 4.6%, Checking APY 0.5%

No account fees or minimum balance requirements

Free paper checks

4.6 on Trustpilot with 8k+ reviews

#1

MOST POPULAR

BEST ONLINE BANK 2024

Read more

EXCELLENT

REVIEW

5.0

05/2024

Bottom Line

An online bank account is a good option for people who prefer a completely digital banking experience. Before you pick an online-only bank, look at the benefits and eligibility requirements. Choose the one with the right features for your needs as well as the best perks.

FAQ

1. What criteria were used to select the top online banks in the US?
We evaluated several factors including interest rates, fees, customer service, accessibility, and technological features to compile our list of top online banks.


2. Are online banks safe to use?
Yes, online banks are safe to use. They are typically insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA), which protects your deposits up to $250,000.


3. How do I open an account with an online bank?
Opening an account is generally straightforward. Visit the bank's website, choose the type of account you wish to open, and complete the application form. You will need to provide personal information and possibly deposit an initial amount.


4. Can I deposit checks or cash with an online bank?
Most online banks allow you to deposit checks digitally via their mobile app. For cash deposits, some online banks may have partnerships with ATM networks or retail locations. Check with the specific bank for your options.


5. How do online banks offer higher interest rates than traditional banks?
Online banks typically have lower overhead costs because they don't maintain physical branches. These savings allow them to offer higher interest rates and lower fees.


6. What should I do if I need help with my account?
Online banks offer customer support through various channels including phone, email, and live chat. Check the bank’s website for the specific contact options and availability.


7. Are there any disadvantages to using an online bank?
While online banks offer many benefits, they may not be suitable for customers who prefer in-person services. Also, dealing with large amounts of cash might be less convenient.


8. Do online banks provide loans and credit cards?
Yes, many online banks offer a range of financial products including personal loans, mortgages, and credit cards. Check with individual banks for specific offerings.


9. How can I compare different online banks?
Consider factors such as the APY (Annual Percentage Yield), fees, the user experience of their mobile app and website, customer service ratings, and additional services like loans or investment options.


10. What happens if an online bank closes down?
If an FDIC or NCUA insured online bank closes, your deposits are protected up to $250,000. The insurance corporation will typically transfer your funds to another insured bank or issue you a check for your balance.

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