Updated May 21, 2019

Best Online Bank: December 2019

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Online banks are convenient, pay higher interest rates, and have less fees. Read on for our list of the best online banks for your money.

Here are the top 10 online banks for 2019:

Online banks have a distinct advantage over your standard brick-and-mortar banks: lower costs.

Many banks pass the savings onto their customers by providing a higher APY and fewer fees.

Where is the Best Place to Open an Online Savings Account?

ForBank
Best Interest RateCIT Bank
Best BonusDiscover Bank Bonus
Best Savings With ATM CardSynchrony Bank
Best Big BankHSBC Direct
Best Customer ServiceAlly Bank

What Is Online Banking?

Online banks have no physical locations, so you must do all your banking businesses online or via an app. Because of the less overhead, they can pay higher interest rates and have less fees. They are FDIC insured like normal banks.

Some online banks provide a full range of services, while some have no checking. Compare carefully and pick one that meets your needs.

Are online banks safe?
Online banks are FDIC insured and subjected to the same federal rules and regulations as traditional banks. If the bank defaults, the government will pay you back everything you had in the account, up to $250,000.

Best 10 Online Banks of 2019

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We've compiled a list of the best online banks for every need. See if there's one that catches your eye.

Ally: Best Full Service Online Bank

    Ally Bank
    Read Review

    Ally Bank

    Pros:
    • CD options
    • No account minimums
    • 24/7 customer service
    Cons:
    • Low Checking APY for lower balance customers

    Our Review: (4.4) Ally Bank offers good interest rates and no account minimums. But is this popular online bank good for you? Learn the benefits (and drawbacks) here... Read full review

Ally Bank is a full-service online bank with checking, savings, IRAs, and even investment services. It's a great choice if you want to handle all your finances at one place.

Top features:

  • No minimum requirements to open any account
  • No monthly service fees for any account
  • Free withdrawals at over 55,000+ Allpoint ATMs worldwide
  • Up to $10 ATM fee refunds per statement cycle
  • Transfer money with your voice through Ally Skill™ for Amazon Alexa; send and receive money with Zelle
  • Free online bill pay and mobile check deposits
  • 24/7 customer service with real human reps

Current rates:

  • Savings: 1.70% APY. No monthly service fee and no minimum deposit.
  • Checking: 0.10% APY under $15,000; 0.50% APY $15,000 or more. No monthly service fee and no minimum deposit. Ally will refund ATM fees for other banks up to $10 per statement cycle.
  • Money Market: 0.75% APY. No monthly service fee and no minimum deposit.
  • CD: 0.75% to 2.15% APY. Terms of 3 months to 5 years. 12-month CD APY of 2.00%. No minimum deposit to open.

Discover: Best Online Bank with Bonus

    Discover Bank
    Read ReviewVisit Site

    Discover Bank

    Pros:
    • High yield
    • Cashback checking
    • 24/7 customer service
    Cons:
    • No interest checking
    • $2,500 minimum deposit for CDs

    Our Review: (4.8) Discover offers high interest rates on its online savings and CD accounts. But there are downsides. Here's what you need to know before you open an account... Read full review

Discover often offers a cash bonus for opening a new savings account (check current promotions). Plus, the Cashback Debit account offers rewards for purchases made with your debit card.

Top features:

  • No opening deposits for Checking and Online Savings
  • No monthly service fees for any accounts
  • Earn cash back rewards for debit card purchases
  • Free withdrawals at over 60,000 ATMs nationwide
  • Free checks
  • Free online bill pay and mobile check deposits
  • 24/7 customer support

Current rates:

  • Checking: Earn 1% cashback on up to $3,000 in debit card purchases each month. No fees and no minimum deposit.
  • Savings: 1.70% APY. No fees and no minimum deposit.

Synchrony: Best for Online Savings

    High Yield Savings

    1.80% APY. $0 minimum opening deposit. No minimum balance requirement. No fees to open or maintain account.
    • Great Rates + Safety = Peace of Mind
    • Member FDIC

If you don't need access to your money often and just need a place to park it while earning a decent interest rate, Synchrony Bank is a great choice. It only offers savings and CDs and has no checking.

Top features:

  • No monthly minimums or fees
  • High savings interest rates
  • Optional ATM card; Free withdrawals at Plus or Accel ATMs
  • Up to $5 ATM fee refunds per statement cycle
  • Free mobile check deposits
  • Customer service available by phone, live chat, and email

Current rates:

  • Savings: 1.80% APY. No monthly service fee and no minimum deposit. An ATM card is provided for easy withdrawal. Synchrony will refund ATM fees for other banks up to $5 per statement cycle
  • Money Market: 1.20% APY. No monthly service fee and no minimum deposit.
  • CD: 0.75% to 2.25% APY. Terms of 3 months to 5 years. Minimum deposit of $2,000 to open.

CIT Bank: Best for Online Savings (Runner Up)

    CIT Bank
    Read ReviewVisit Site

    CIT Bank

    Pros:
    • High APY
    • No monthly service fees
    • Low opening deposits
    Cons:
    • No physical locations
    • No check writing

    Our Review: (4.5) Want a higher interest rate at a good FDIC insured bank? CIT is tempting, but there are downsides you should not ignore. Read this review before you open an account... Read full review

CIT Bank offers checking, savings accounts, and CDs. Its Savings Builder account offers a great rate and encourages users to save every month. The savings account doesn't come with an ATM card for easy withdrawals.

Top features:

  • $100 minimum to open Savings Builder account
  • No monthly maintenance fees
  • Get a high APY if you can save $100 per month
  • Mobile check deposits

Current rates:

  • Savings: Savings Builder up to 1.85% APY with $25,000 minimum balance or $100 monthly deposit. $100 minimum opening deposit.
  • Money Market: 1.85% APY. $100 minimum deposit. No monthly maintenance fee.
  • CD: Term CDs up to 1.85% APY. $1,000 minimum opening deposit. No monthly maintenance fee.

NBKC Bank: Best for Online Checking

NBKC (National Bank of Kansas City) allows anyone to open their online checking and savings accounts. We like NBKC's checking account because it provides a high interest rate for all balances.

Top features:

  • $5 to open; no minimum balance requirements
  • No monthly service fees
  • Free withdrawals at 32,000+ MoneyPass® ATMs nationwide
  • Up to $12 ATM fee refunds per statement cycle
  • Free online bill pay and check deposits
  • No overdraft fees
  • Free set of starter checks

Current rates:

  • Checking: 1.01% APY. $5 to open, no monthly service fees
  • Money Market: 1.66% APY on balances up to $1 Million. $5 to open, no monthly service fees
  • CD: 0.50% to 1.97% APY. Terms of 3 months to 5 years. Minimum deposit of $1,000 to open.

Capital One 360: Best Customer Experience

    Capital One

    Pros:
    • Overdraft protection options
    • No account minimums
    • 27 Capital One cafes for in-person support
    Cons:
    • Lower savings APY compared to other online banks

    Our Review: (4.3) Capital One 360 checking and savings accounts are free to open and offer higher-than-average APY rates. Does this popular web bank live up to its claims? Find out if it's right for you... Read full review

Online banks can feel impersonal. Capital One 360 stands out from other online banks by providing a great experience. It has a top-of-the-line app as well as Capital One 360 cafes where you can ask questions and engage with the community.

Top features:

  • No opening minimums or monthly service fees
  • No foreign transaction fee
  • Free withdrawals at 39,000+ Capital One or Allpoint ATMs
  • Easily send and receive money with Zelle
  • Highly rated mobile app
  • Get help opening an account, meet with financial advisors, and attend events at Capital One 360 cafes

Current Rates:

  • Checking: 0.20% APY. No monthly service fee and no minimum deposit. Overdraft options prevent you from being charged when you accidentally overdraw
  • Savings: 1.80% APY. No monthly service fee and no minimum deposit.
  • Money Market:

TIAA Bank: Best One Year Intro Rates

    TIAA Bank

    Pros:
    • High intro APY
    • No monthly service fees
    • Refund ATM fees
    Cons:
    • Large minimum deposit
    • Intro rate only for one year

    Our Review: (4.3) If you have a large opening deposit, TIAA Bank provides a variety of options at high introductory rates. But there are downsides. Read on to see if it's right for you... Read full review

TIAA Bank guarantees that the yield on your account will stay in the top 5% of similar accounts offered in the U.S. banking market. It offers a great first year intro rate on its Yield Pledge Checking and Money Market Accounts. However, it has larger opening deposit requirements than other online banks.

Top features:

  • $100 minimum to open Yield Pledge Checking
  • 1-year intro APY on balances up to $250k
  • Unlimited ATM refunds for accounts $5,000+ ($15/month in refunds for accounts below $5,000)
  • Mobile check deposits
  • Debit card with purchase protections

Current rates:

  • Checking: Yield Pledge Checking: 0.25% - 0.65% APY depending on balance. 1-year 1.01% intro APY on balances up to $250,000. Minimum deposit of $5,000. No monthly service fee.
  • Money Market: 1.01% - 1.70% APY depending on balance. 1-year 1.85% intro APY on balances up to $250,000. No monthly service fee. Minimum deposit of $500.
  • CD: Basic CD: 1.25% - 1.95% APY. Terms of 3 months to 5 years. Minimum deposit of $1,000. Yield Pledge CD: 1.50% - 2.20% Terms of 3 months to 5 years. Minimum deposit of $5,000. No monthly service fee.

Simple: Best App-Based Banking for Young Adults

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Simple helps make banking and money management more fun and effortless. It's an app-based bank with budgeting features to help students and young adults to manage their money better.

Top features:

  • No opening minimums or monthly service fees
  • Save without thinking with round-up rules
  • High interest rates on your Protected Goals
  • "Safe to spend" feature tells you how much you have left after your bills and budgets
  • Automatically transfer money to your goals
  • Add photos and hashtags to your transactions

Charles Schwab: Best Online Bank for Travelers

    Charles Schwab Bank

    Pros:
    • No account minimum
    • No service fees
    • Refund all ATM fees
    Cons:
    • Only checking or savings
    • Must do banking online

    Our Review: (4.3) Charles Schwab is more than a brokerage. It also offers high yield checking and savings interest rates that might far surpass your local bank. Read on to learn the pros and cons... Read full review

Charles Schwab may be best known for investments, but it also offers a great online checking option. Many travelers especially love using Schwab's checking account for the following reasons.

Top features:

  • No opening minimums or monthly service fees
  • Unlimited ATM fee refunds worldwide
  • No foreign transaction fee on the debit card
  • Free standard checks
  • Free online bill pay and mobile check deposits

Current rates:

  • Checking: 0.15% APY, $0.01 account minimum

Axos: Best Online Bank for Small Business

    Axos Bank
    Read ReviewVisit Site

    Axos Bank

    If the perfect checking account for you is one with no monthly fees while offering rewards, you may have found your match with Axos Bank... Read full review

Small businesses trying to keep their fees in check often benefit from online banks. With lower minimum deposit requirements and fewer fees, the accounts can be more affordable. We chose Axos as the best online bank for small business for the following reasons:

Top features:

  • $1,000 minimum to open a basic checking account
  • No monthly service fees
  • Large ATM network worldwide
  • Free online bill pay and mobile check deposits
  • First 200 transactions are free ($0.30/item afterwards)
  • First set of 50 checks free

Online Banking Pros & Cons

PROS:

  • Higher interest rates than traditional banks
  • Often no (or very low) opening deposit
  • Often no monthly service fees or balance requirements
  • Convenience - manage your account 24/7 online
  • Easy to open an account online

CONS:

  • No physical branches
  • No personal relationships with your banker
  • Limited services available
  • More hassle to deposit cash

What to Look for in an Online Bank

© CreditDonkey

Before choosing an online bank, make sure to compare features like:

  • High interest rates
    Online banks tend to offer higher APY but rates do vary.

  • Monthly service fees
    Most online banks don't charge a monthly maintenance fee. For the ones that do, see if you're comfortable with the monthly balance requirement.

  • Opening deposit requirement
    Weigh the opening minimums against interest rates and features you want.

  • Deposit and withdrawal restrictions
    Read the fine print to understand the bank's deposit and withdrawal policy. Pay special attention to any waiting period to access deposited funds or receive a withdrawal.

  • Reimbursement of ATM fees
    If a bank offers access to an ATM network, inquire about the fees you may incur and whether they will be reimbursed.

  • Accessible customer service
    Without the ability to walk into a local bank, you need to be able to get a hold of reps when you have problems. Some online banks only superior 24/7 customer service by phone or even live chat.

  • FDIC insurance
    This goes without saying: you want your money protected should anything happen to the online bank.

  • Strong security
    Conducting your banking online can put your money at risk. Most banks have superior security, including data encryption.

How to Make Deposits and Withdrawals

© CreditDonkey

Online banks let you handle your business without leaving your home. But without the ability to drive up to your local bank branch, where do you make deposits and withdrawals? Keep reading for the answer.

Making Deposits

You have these options for making deposits:

  • Direct deposit
    Get your paycheck sent directly to your new online account.. Simply provide your HR Department with your bank's routing number and account number. Many companies even allow you to split up deposits between accounts.

  • Mobile check deposits
    Most online banks offer mobile deposits via the bank's app. Just take a picture of both sides of the check to deposit it remotely. If you have cash rather than a check, you can buy a money order (for $1 or $2), and then use the above method for the mobile deposit.

  • Electronic transfer
    This requires an extra step, but you can first deposit cash or checks in a local bank account. You then initiate an electronic bank transfer to send the funds to your online bank. This can take up to three business days.

Withdrawal limits for savings accounts: According to Regulation D, you can only make up to six outgoing transfers from your savings account or money market per month. If you exceed the limit, you may pay penalty fees.

Making Withdrawals

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Gaining access to your money is easier than making deposits with an online bank. Most banks offer:

  • ATMs
    Some online banks have agreements with partner ATMs throughout the country. This may allow you to withdraw your funds without any fees.

  • Debit card
    Some online banks offer a linked debit card with your checking account that you can use for purchases.

  • Electronic transfer
    You can transfer your funds to a local checking account and then withdrawal from there via ATM. You'll have to allow a few days for the transaction to process.

  • Checks
    Online checking accounts include checks (either free or for a small fee). You can use them as you would with a checking account at a brick-and-mortar bank.

You need a checking account for day-to-day use. A savings account is not easily accessible, especially from online banks and if you need cash fast, then you're kind of out of luck. That is why you should have a checking account for purchases you need to make frequently. Keep the bulk of your money in a savings account where you are earning interest and then keep some money in your checking for the purchases you need to make. Michael Outar, founder, Savebly.com

Bottom Line

Online banking can be a great way to make more interest on your money while paying fewer fees. Do your due diligence and find the bank that suits your needs while giving you the best return on your investment.

Disclaimer: Opinions expressed here are author's alone. Please support CreditDonkey on our mission to help you make savvy decisions. Our free online service is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content.

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