The best online bank according to our overall rating is Ally Bank. Not only does it offer a wide range of banking and investment services—as well as helpful customer tools—but it also pays some of the highest interest rates in the country and charges relatively few fees. Depending on your financial situation, you may prefer a different bank. Below, you'll find banks to help grow your savings, banks with student-friendly features, and banks that are ideal for travelers and couples who want to open an account together. Be aware that not all of the banks below offer great rates on deposit accounts—if you're looking for the highest APY you can get, explore the best high-yield savings accounts and remember that you can always open a high-yield account in addition to accounts from the banks below. Investopedia defines online banks as financial institutions that operate primarily or even solely online, generally with no physical branches. These include some of the largest banks in the country. We reviewed 19 of the top options and collected nearly 500 data points—comparing rates, account features, fees charged, minimum deposit requirements, and more—to determine which banks take the best care of you and your money. The 6 Best Online Banks for May 2024 The 6 Best Online Banks for May 2024 Final Verdict What is Online Banking? Pros and Cons How to Choose Alternatives Why You Can Trust Us FAQs How We Picked the Best Learn More Why We Chose It Ally Bank wins the overall category for best online banks because of its generous rates, minimal fees, and user-friendly budgeting features that make it easy to manage your money. This bank also offers a wide array of products, from checking and savings to investing and loans. Pros & Cons Pros High rate on checking and savings No monthly maintenance fees No minimum balance requirements Banking, investing, and lending products Cons No ATM card with savings account No cash deposits No physical branches Products and Features We Like Ally Bank offers a little bit of everything and still manages to do it well, which is why it takes the cake for the best online bank. Both the checking and savings accounts offer an APY that's well above market average, and the rates on CDs and money market accounts are also generous. Plus, you won't have to pay any monthly maintenance fees on any accounts, and you don't have to maintain a minimum balance to earn interest. In addition to checking and savings products, Ally Bank also offers a whole suite of investment and lending products, which is rare for online banks. These include managed investment portfolios, individual retirement accounts (IRAs), trading, mortgage loans, mortgage refinancing, auto loans, and personal loans. Both the website and mobile app are easy to navigate and offer plenty of helpful additional features, such as the ability to create "savings buckets" to better organize your funds. Ally has no physical branches, so online banking is your only option. You also can't deposit cash to any of Ally's accounts, and the savings account doesn't offer an ATM card. This means it can take 1 to 3 days to get your money unless you have a Ally checking account as well. Read the full Ally Bank review. Bank Details Based in Utah, Ally Bank is a wholly owned subsidiary of Ally Financial, which is headquartered in Michigan. Ally Bank was rebranded from GMAC (General Motors Acceptance Corporation) in 2010, with its FDIC membership reaching back to 2004. Why We Chose It With high yields and no monthly maintenance fees for savings accounts, it's hard to beat Synchrony Bank. Pros & Cons Pros High APY No monthly maintenance fees No minimum balance requirements ATM card and up to $5 ATM reimbursem*nts per statement Cons No checking account Outgoing wire transfer fee No physical branches Products and Features We Like Synchrony Bank's High Yield Savings account consistently offers one of the highest APYs out there without charging monthly fees or requiring any minimum balance, earning it the prize for best savings account. The bank's app is easy to use and allows for mobile check deposits. You'll also get an ATM card with your Synchrony savings account for easy access to your funds. On top of free in-network ATMs, Synchrony will reimburse you for up to $5 per statement in out-of-network ATM fees. Because it has an ATM network, you can do ATM deposits in addition to direct deposits, electronic transfers, and mobile deposits to fund your account. Synchrony does charge a $25 outgoing wire transfer fee, which isn't out of the ordinary. But some of the other best online banks don't charge that. It doesn't offer a checking account either, but since you can get an ATM card with your savings account, that isn't really necessary. Read the full Synchrony Bank review. Bank Details Based in Utah, Synchrony Bank is a wholly owned subsidiary of Synchrony Financial, which is headquartered in Connecticut. Synchrony Bank has been an FDIC member since 1988. Why We Chose It Capital One offers online a full range of products that include some great account options for young adults who want minimal fees, no balance requirements, and the ability to easily receive money from parents, making them the best pick for students. Pros & Cons Pros Fee-free checking and savings No minimum balance for checking or savings Option for parent-teen joint account Up to $15 per statement in ATM fee reimbursem*nts Cons Not the highest APY No checks with teen checking Branch locations not present in every state Products and Features We Like Capital One offers an interesting hybrid model of being an online bank with some physical branch locations called "Capital One Cafés." Students looking to learn more about personal finance can grab a coffee in one of these cafés and get free one-on-one money coaching, providing a little bit of what brick-and-mortar banks can provide that online banks typically don't. This bank also has several banking products geared toward young adults, which is why we chose it for students. The MONEY Teen Checking account is completely free with no balance requirements, and teens can open a joint account with their parents, who can then easily deposit money in their accounts through the Capital One app. The account does have some transaction limits and parental controls, but those can be lifted once you turn 18. Capital One also offers a 360 Performance Savings account that's completely free and earns a competitive rate. The mobile app is easy to use and lets you deposit checks, process transfers, and track your saving progress on-the-go. Finally, the Journey Student Rewards credit card is a great way for students to build credit. It has lenient credit requirements, no annual fee, and earns cash back rewards. Read the full Capital One Bank review. Bank Details Based in Virginia, Capital One is the eighth largest U.S. bank by deposits. It became an FDIC member in 1934. Why We Chose It Discover's checking account comes with absolutely no fees and a debit card that earns rewards, which is rare. This, plus a network of over 60,000 ATMs in the U.S., make it the best choice for checking. Pros & Cons Pros No monthly maintenance fees No minimum balance requirements No overdraft fees Free cash rewards debit card Cons Doesn't earn interest No cash deposits No physical branches Products and Features We Like Discover is one of few truly fee-free banks, making it the best option for your checking account. In addition to not charging monthly maintenance fees or requiring any minimum balance, this account doesn't charge overdraft fees, card replacement and expedited delivery fees, outgoing wire transfer fees, or check order fees either. There will be no interest earned on this checking account, but it does come with a free cash back rewards debit card, and you'll probably earn more that way anyway. Account holders get 1% cash back on up to $3,000 in purchases every month. Max that out, and you'll be getting $360 per year, which is about as good as it gets for a debit card. Discover also offers a high-yield savings account. The Discover mobile app makes it easy to deposit checks through your phone and transfer money through Zelle. You won't be able to make cash deposits, even through the network of 60,000 U.S. ATMs. Read the full Discover Bank review. Bank Details Discover Bank is a wholly owned subsidiary of Discover Financial, which is headquartered in Illinois. Discover Bank became an FDIC member in 1934. Why We Chose It Charles Schwab might be the only bank to offer a checking account that charges no transaction fees, no monthly maintenance fees, and gets you unlimited ATM fee rebates worldwide, essentially offering completely fee-free ATMs. This makes it perfect for travelers, particularly those who travel overseas. Pros & Cons Pros No monthly maintenance fees No minimum balance requirements Unlimited ATM fee rebates worldwide No foreign transaction fees Cons No cash deposits Low APY compared to other options Products and Features We Like Charles Schwab is primarily known for the investment services it offers, but it's also one of the best online banks, especially for jet-setters who want to avoid fees while overseas. A Schwab Bank Investor Checking account is completely free, and you won't get charged foreign transaction fees while abroad. Plus, you'll get unlimited ATM fee rebates worldwide and a modest APY. While the checking account is where this bank shines for travelers, it does offer a Schwab Bank Investor Savings account as well. The rate isn't anything special, so you might want to keep larger savings balances elsewhere. That said, it's a free savings account with no minimum balance requirements, so it doesn't hurt to open one alongside your checking account. In addition to checking and savings, Schwab also offers a long list of brokerage, trading, investment, and retirement products. If you live abroad, Schwab even has professional services to help you figure out how to invest from wherever you're located. Plus, its website has a 24/7 live chat, so you don't have to worry about making international calls if you have an issue. Read the full Charles Schwab review. Bank Details Charles Schwab Bank is a wholly owned subsidiary of Charles Schwab Corporation. Both are based in Texas. Charles Schwab Bank has been an FDIC member since 2003. Why We Chose It Axos offers some of the best rates on the market for both checking and savings, especially if you have a higher balance and more frequent transactions. This makes it great for couples who are combining funds into one joint account and want to make the most of their money. Pros & Cons Pros No minimum balance requirements No monthly maintenance fees Unlimited domestic ATM fee reimbursem*nts Multiple checking and savings options Cons $50 minimum deposit to open Rewards Checking $250 to open High-Yield Savings Minimum transaction requirements to earn APY on checking Low CD rates No physical branches Products and Features We Like If you and your partner are looking to combine finances into a joint account, look no further than Axos Bank. The Rewards Checking account offers one of the highest APYs of any checking account out there to folks who can meet its balance and transaction requirements, and if you've got two people on the account, you're more likely to hit those marks. To get the full 3.30% APY, you'll need to receive at least $1,500 in direct deposits and complete at least 10 debit card transactions per month, have an average daily balance of $2,500 per month in an Axos Invest Managed Portfolios Account, have an average daily balance of $2,500 per month in an Axos Invest Self Directed Trading Account, and use the account to make monthly payments on Axos' mortgages, personal loans, or auto loans. This account doesn't charge any fees, and you'll get unlimited domestic ATM fee reimbursem*nts. Plus, the app lets you and your partner sync all your different financial accounts to one place and even analyze your spending behavior as a couple, making it one of the best online banks for joint accounts. Read the full Axos Bank review. Bank Details Based in California, Axos Bank is a wholly owned subsidiary of Axos Financial, which is headquartered in Nevada. Axos Bank has been an FDIC member since 2000. Some online banks are better for checking, others for savings, and others for loans or investing. The best online banks can do it all—and Ally Bank does, consistently offering some of the highest rates on completely fee-free accounts. This, plus useful extras like the savings buckets and savings booster features, make it the best overall bank. You can use Ally Bank as a one-stop online shop for all your financial needs, whether you're looking to bank, borrow, or invest, and know you're always getting a good deal. In the News: The Fedheld rates steadyfor a sixth consecutive time at its meeting that concluded May 1, 2024. The 5.25% to 5.50% range is the highest the federal funds rate has been since 2001, and Fed officials noted in their statement that there has been a lack of progress toward the committee’s goal of lowering inflation. With consumer prices showing a 3.5% inflation rate in March, Fed officials don’t foresee reducing their benchmark rate until they're confident inflation is moving toward 2%. Deposit account rates, especially at online banks, closely follow the fed funds rate. As a result, the best high-yield savings account rates, as well as the best CDs, are paying at or near 20-year highs. But once it appears the Fed is ready to make a rate cut, savings and CD rates are expected to begin falling. Online banking simply refers to using a mobile app or desktop computer to access your account and conduct transactions. Since online banks don't operate physical branches, internet banking is often the only way customers can interact with their bank. When you open a new account, you'll be prodded to set up a username and a password, allowing you, and only you, to securely enter the bank's online customer site. You'll then be able to use those login credentials to access online banking service anytime you want, such as to check a balance, download a statement, transfer funds, or set up bill payment. Online banks offer both benefits and drawbacks, just like any other type of financial institution. Below are some of the top pros and cons to consider when comparing online banks to other banks and credit unions. Pros Tend to offer higher interest rates Usually charge fewer and lower fees Often provide a good online interface Cons No way to visit the bank in person May provide a more limited menu of products and services Depositing cash may not be possible Looking for a business account? See the best business bank accounts to explore your options. Traditional banks operate brick-and-mortar locations, giving customers the option to visit a branch to conduct their banking business in person. The biggest of these—like Chase, Bank of America, Wells Fargo, Citi, and U.S. Bank—staff and maintain hundreds of physical branches in multiple states. Online banks, in contrast, operate primarily, or even exclusively, online. While a rare few may have some branch locations, the vast majority offer no physical branches at all, making it possible to do all of your banking without going to a bank at all. Because online banks don't have the overhead costs of operating, maintaining, and staffing brick-and-mortar locations, online banks tend to charge fewer and lower fees (the best online banks charge no fees). They also often offer higher interest rates on your savings. That said, you won't always get the whole suite of financial services—such as mortgages, personal loans, and retirement—that you can find at traditional banks. As you can see, for those wanting a very traditional, full-service experience from a bank, including the ability to walk in and deposit cash, a traditional bank may offer the right fit. But for those looking to maximize their financial resources by earning more on the savings and reducing what they pay in bank fees, online banks offer a strong advantage. "I was an early adopter of online banking, opening my first internet bank account more than 20 years ago. My husband and I were saving for a house at that time, and I saw the opportunity to earn a much higher rate on my savings with the online banking options than I could get from our local banks. In all the years since, we've always had at least one online bank account, and often more than one. A pro tip for making this work well is to always have one local banking relationship as well. We have a long-standing account at a credit union in my city, so that if I need to deposit cash or withdraw a large amount of cash, I always have an option to handle that transaction in person." - Sabrina Karl, Staff Writer, Investopedia Financial Products & Services Choosing the best online bank is all about finding the right features for your needs. Here are some considerations: Online banks are just as safe as physical banks, as long as you make sure you're dealing with an FDIC-insured institution. According to the Federal Deposit Insurance Corporation, "if your FDIC-insured bank fails, the FDIC will protect you against the loss of your insured deposit amount whether the bank is brick and mortar or online-only." FDIC-member banks will always have the FDIC logo or the words "Member FDIC" on their website. But to be absolutely certain, the FDIC recommends entering the bank name into the FDIC BankFind tool, which provides details on every FDIC-insured bank. One of the notable advantages of online banks is that they are generally easy to interact with from the comfort of your home. Even getting started with a new account can be done via your computer or smartphone. Here are the basic steps: When your application process is complete, you may be provided with your new account number and be able to interact with your account right away. Or you may need to wait a day or two to receive confirmation that the account has been opened and how to establish your online banking credentials. An online bank can be a solid choice for many people—either as a primary banking option or as a supplement to their primary checking or savings account. But if you’re unsure whether online banks are right for you, here are a few alternatives to consider. Investopedia collected more than a dozen key data points on each online bank we considered to identify the most important factors for readers choosing an internet banking partner. We used data on fees, rates, account features, and minimum balances to review each bank and provide unbiased, comprehensive reviews so readers can make the right financial decisions for their needs. Investopedia launched in 1999, and has been helping readers find the best online banks since 2021. Online banks are well suited to anyone who wants to earn a higher interest rate on their savings, as online banks often pay much more competitive APYs on savings, money market, and certificate of deposit (CD) accounts. They are also a good fit for those who are very comfortable with online and mobile banking applications, and who seldom need in-branch services. Still, an online bank works best when it complements at least one other account held at a local bank or credit union. That's because you may find you occasionally need in-person service, such as depositing cash. So while an online bank can be a great primary banking option for almost anyone, it can help to also have access to a local institution that operates branches in your community. The answer to this question depends largely on you. Online banks can provide a wide variety of banking services, and many customers will find all of their needs met by these online services. But if you are someone who often needs to deposit cash, you may find that having an account at a physical bank in your community is necessary. Though some online banks will let you deposit cash via an ATM, many do not. If you find you're accumulating too much cash at home and want to deposit it in a bank account, a local bank branch will be useful to you. This doesn't mean you can't use an online bank for most of your banking, however. In fact, the perfect solution for many people is to use an online bank as their primary institution, but have a free checking or savings account open at a local bank. This way you can still take advantage of the benefits that online banks offer, but when you occasionally need to visit a branch to deal with cash, you can do that locally. You can then make any transfers between to the two institutions online. Online banks often outperform traditional banks in terms of the APYs they offer customers. Yet the interest rates they (and other financial institutions) extend to their customers are typically variable and may change on a frequent basis. Some of our top picks with high savings interest rates include Ally Bank, Synchrony Bank, Capital One, and Discover; Axos Bank has competitive rates for online checking accounts. If you’re shopping for a new savings account, you can always find the top nationwide rates in our daily ranking of the best high-yield savings accounts. Yes, the FDIC does insure online banks, in the exact same way it insures deposits at brick-and-mortar banks. Should an FDIC bank of any kind fail, your deposits up to $250,000 per person and per institution are federally covered. In terms of being a trustworthy place for your funds, there is no discernible difference among the banks in our ranking since they are all FDIC-member banks and therefore carry the same federal protections as any other FDIC bank. Just look for the words "Member FDIC" or the FDIC logo on the bank's website. The best online banking apps are user-friendly and make it easy to manage your money and take advantage of the features of your bank account (e.g., mobile check deposits, funds transfer, bill payment, etc.). Some banking apps (like Ally Bank’s) even offer helpful budgeting options that allow you to set and work toward multiple savings goals within a single account. Stand-alone budgeting apps may provide more control over your money, especially if you use multiple bank accounts and credit cards. It’s important to organize your finances and create a plan for your money to avoid overspending; this will help you achieve the financial goals that are most important to you. Ally Bank is the largest U.S. bank by assets that is an online-only operation. As of March 31, 2023, Ally ranked 20th in size among more than 4,600 FDIC banks, with more than $185 million in assets. Ally was founded in 2004. Generally speaking, online banks have fewer fees than physical banks, with many of them being free for customers. Part of the reason is that institutions that don't have to pay for and maintain brick-and-mortar branches have more funds available for other things. One way online banks often deploy these funds is to give their customers a positive experience, which includes as few fees as possible. As you can see in our reviews above, these six winning banks are all fee-free in terms of monthly maintenance fees. So choosing the best option for you will depend on how you value other differentiating factors. The most common way to both deposit and withdraw funds from an online bank account is via external transfers to or from another bank. Your online bank account will allow you to set up one or more outside institutions where you have an account in your name, establishing a link between them that you can use however often you like. You can also do the reverse: establish a link to your new online account at your existing bank. The transfers can work either way. Most online banks will also allow you to deposit paper checks into your account, using the mobile check deposit feature of their app. Wire transfers to or from an online bank account are another possibility of moving funds, and usually are executed with same-day service. But fees may apply. Most online banks will not allow you to deposit cash via an ATM. There are exceptions, though, in which an online bank will allow cash deposits at an ATM that's part of a specified network. If not, however, there are ways around this. The most common is to have one local bank account. This is handy for handling cash transactions, and one good way to do it is to hold a free checking or savings account at a local bank or credit union, and link it through online banking for transfers between it and your online bank account. One more option is to send cash deposits through the mail. Some online banks may offer this, but it's of questionable safety since your cash deposit could get lost in the mail. Your better bet is to find a way to deposit the cash via ATM or local branch. We researched and reviewed 19 online banks to choose the 6 best options you see above. Banks that were not selected may have more or higher fees, lower interest rates, fewer account features, or higher minimum requirements. Below are all of the online banks we researched, along with links to available reviews, to help you learn more before making a decision: Alliant Credit Union, Ally Bank, American Express, Axos Bank, Barclays, Bask Bank, Capital One, Charles Schwab Bank, CIT Bank, Discover, E*Trade, GO2bank, LendingClub, Marcus by Goldman Sachs, Quontic Bank, SoFi, Synchrony Bank, Varo, and Vio Bank. To select the best online banks, Investopedia researched 19 institutions, reviewing rates, fees, minimum balance requirements, rewards, customer service, mobile banking apps, and types of accounts offered. These are the most important features when it comes to online banking if you want to minimize your costs, maximize your earnings, and enjoy a convenient and easy banking experience. To provide a numeric score to each institution, the most heavily weighted parameters were interest rates on savings, money market, and CD accounts available at the bank, the number of states from which the bank accepts customers, and the number of available ATMs. Article Sources Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in oureditorial policy. Federal Deposit Insurance Corporation (FDIC). BankFind Suite; Top Banks by Asset Size. Bureau of Labor Statistics. "Consumer Price Index." Federal Reserve. "Federal Reserve Issues FOMC Statement." Federal Deposit Insurance Corporation. "FDIC Consumer News: Is Digital Banking for Me?" Federal Deposit Insurance Corporation. BankFind Suite. Related Terms What Is Online Banking? Definition and How It Works Online banking allows a user to conduct financial transactions via the Internet. Online banking is also known as Internet banking or web banking. more What Is a Checking Account? Here's Everything You Need To Know A checking account is an account held at a financial institution that allows deposits and withdrawals. Learn how checking accounts work and how to get one. more What Is a High-Yield Checking Account? A high-yield checking account provides interest at an above-average rate, in some cases above 5% or 6% APY. But these accounts usually come with stringent requirements. more What Is a Student Bank Account? Student bank accounts are accounts designed for teens and young adults. Learn about the features of a typical student bank account and how to compare them. more Credit Unions: Definition, Membership Requirements, and vs. Banks A credit union is a member-owned financial cooperative that is created and operated by members and shares profits with owners. It has certain advantages over banks. more How Do Commercial Banks Work, and Why Do They Matter? A commercial bank is a financial institution that accepts deposits, offers checking and savings account services, and makes loans. moreThe 6 Best Online Banks for May 2024
Best Online Bank Overall : Ally Bank
Best Online Bank for Savings : Synchrony Bank
Best Online Bank for Students : Capital One
Best Online Bank for Checking : Discover
Best Online Bank for Travelers : Charles Schwab
Best Online Bank for Couples : Axos Bank
Final Verdict
Compare the Best Online Banks
Company Types of Accounts ATMs APY Ally Bank
Best OverallChecking, Savings, CDs, Money Market, Investing, Retirement No fees at 43,000 Allpoint ATMs, and up to $10 reimbursed per statement cycle for fees incurred at other ATMs 4.20% for savings, 0.10-0.25% for checking Synchrony Bank
Best for SavingsSavings, Money Market, CDs, Retirement, Credit Cards Free access at any ATM displaying the Plus or Accel logos, both in the U.S. and abroad. For fees incurred at other ATMs, up to $5 reimbursed per statement cycle. 4.75% for savings, no checking Capital One
Best for College StudentsChecking, Savings, CDs, Credit Cards No fees at 70,000 Capital One, MoneyPass, and Allpoint ATMs 2.50% youth for savings, 0.10% for checking Discover
Best for CheckingChecking, Savings, CDs, Money Market, Retirement, Credit Cards No fees at 60,000 Allpoint and MoneyPass ATMs 0% for checking (1% cash-back), 4.25% for savings Charles Schwab
Best for TravelersChecking, Savings, CDs, Investing, Retirement Unlimited fee reimbursem*nts for any ATM worldwide 0.48% for savings, 0.45% for checking Axos Bank
Best for CouplesChecking, Savings, CDs, Money Market, Investing Axos does not charge any ATM fees, and it will reimburse all domestic ATM fees imposed by other banks. Up to 0.61% for savings, up to 3.30% for checking In the News
What is Online Banking and How Does it Work?
What Are the Pros and Cons of Online Banks?
Online Banks vs. Traditional Banks
How To Choose an Online Bank
How to Open an Online Bank Account
Alternatives to Online Banks
Why You Should Trust Investopedia Reviewers
Frequently Asked Questions
Who Are Online Banks Best For?
Is It Better To Have an Online Bank or a Physical Bank?
Which Online Banks Have the Best Savings Account Rates?
Are Online Banks Safe? Will My Money Be FDIC Insured?
What’s the Best Online Banking App?
What Is the Biggest Online Bank?
What is the Best Free Online Bank?
How Do You Deposit and Withdraw Money in an Online Bank Account?
What Online Banks Are You Reviewing?
How We Picked the Best Online Banks
Learn More About Online Banks
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