11 Best Online Banks: Start Today

Interest rates have been rising rapidly in recent months, and you may be pleasantly surprised to see how much. If you’re currently holding your money in a bank that’s paying 0.0-something percent on your balance, you need to seriously investigate the alternatives.

In this guide, we’re going to provide 11 of the best online banks, most of which pay interest rates on deposits well above “traditional” banks.

Let’s start with a high-altitude summary with the table below. We’ve listed all 11 banks and their basic features. Take a quick glance through the table, then move down to the summary reviews of any you’re interested in just below the table.

Our Picks for Best Online Banks

Below is our list of the 11 best online banks, and what each bank is especially good at:

• Ally Bank: Best All-Around

• Discover Bank: Best Rewards Checking

• Alliant Credit Union: Best Online Credit Union

• CIT Bank: Best for High-Interest Savings

• Capital One Bank: Best Online Banking with Credit Cards

• Chime: Best for Depositors with Bad Credit

• PenFed: Best High Interest on CDs

• Bank of America: Best Full-Service Bank

• NBKC: Best Small Full-Service Online Bank

• PNC: Best Banking Virtual Wallet

• Betterment: Best Investment Service with Banking

• Products Offered: Checking, online savings, money markets, and CDs

• Minimum Balance Required: None

• APY on Best Account: 4.40% APY (Money Market Account)

• Monthly Fees: None

• ATM Network: 43,000+

Ally Bank got our vote as the best all-around online bank. Not only do they pay 4.40% APY on their money market accounts, but they also offer interest-bearing checking, and high-yield certificates of deposit (CDs).

But that’s not all that makes this online bank stand out. In addition to interest-bearing deposit accounts, they also offer mortgages, car loans, and personal loans. They also offer self-directed trading of most investment securities, as well as a robo-advisor and wealth management services.

Ally Bank offers interest checking with two tiers. The account pays 0.10% APY on balances less than $15,000, and 0.25% APY on balances above. The account also comes with a Round Up feature enabling you to save money as you spend.

Ally Bank also offers CDs with terms between three months and five years, and interest rates ranging from 0.50% and 2.75% APY.

• Products Offered: Online savings, checking account, money market, and CDs

• Minimum Balance Required: None

• APY on Best Account: 3.60% APY on online savings account

• Monthly Fees: None

• ATM Network: 60,000+

Best known for its high-rewards credit cards, Discover also offers online banking with high interest. Though their online savings account pays the highest rate at 3.60% APY, their money market comes close, with 3.50% APY on balances up to $100,000, and 3.55% APY on higher balances. They also offer CDs in terms of 12, 24, and 60 months, with interest rates ranging between 4.15% and 4.30% APY.

Much like Ally Bank, Discover has none of the usual fees. They even waive the excess withdrawal fee on their online savings account. Meanwhile, you can receive 1% cashback on debit card purchases up to $3000 each month with their no-fee checking account.

• Products Offered: Savings, interest checking, and children’s accounts

• Minimum Balance Required: $5, but $100 to earn interest

• APY on Best Account: 1.00% APY on high-yield online savings

• Monthly Fees: None with electronic statements

• ATM Network: 80,000+

Alliant Credit Union is one of the largest credit unions in the nation. And though based in Illinois, it’s available to depositors nationwide. As a credit union, they offer a full line of banking services. This includes credit cards, mortgages, home equity lines of credit, auto loans, personal loans, and even commercial real estate financing.

Their High-Rate Savings Account currently pays 1.00% APY with a minimum balance of $100, and no monthly fee if you choose electronic statements (paper statements are $1 per month). Meanwhile, the high-yield checking account pays 0.25% APY with no monthly service fee or overdraft fees and has no minimum balance requirement.

• Products Offered: Money market, savings account, eChecking, and CDs

• Minimum Balance Required: $100

• APY on Best Account: 1.35% APY on Savings Connect account

• Monthly Fees: None

• ATM Network: 7, but up to $30/month ATM fee reimbursement

CIT Bank’s star account is their Savings Connect account. It currently pays 1.35% APY and requires a minimum of $100 to open. It requires connecting the savings account with an eChecking account. And speaking of eChecking, that account pays interest of 0.10% APY on balances less than $25,000 or 0.25% above. It also requires a minimum opening balance of $100.

Meanwhile, the money market account pays 1.00% APY and requires a minimum of $100 to open. They also offer their Savings Builder account, which pays up to 0.70% APY. But this savings account is a bit complicated. It requires a minimum balance of $25,000 or making monthly deposits of at least $100, to earn the maximum interest rate. The rate falls to 0.34% if you don’t.

CIT Bank also offers an interesting array of CDs. Unfortunately, other than the No Penalty 11-month CD, currently paying 1.40% APY, the interest rate returns on their CD products pay well below 1%. CIT Bank also offers home mortgage loans, as well as business and commercial financing.

• Products Offered: Checking, savings, CDs, team checking, and kids savings accounts

• Minimum Balance Required: None

• APY on Best Account: 1.00% APY on 360 Performance Savings

• Monthly Fees: None

• ATM Network: 70,000+

Much like Discover, Capital One is perhaps best known for its line of very attractive credit cards. But they also offer online banking that includes interest-bearing checking and savings accounts, as well as a wide range of CDs. The most impressive program is the 360 Performance Savings account, which currently pays 1.00% APY on all balances. There are no monthly fees and no minimum balance requirement.

Their 360 Checking account is an interest-bearing checking account, currently paying 0.10% APY. Like the 360 savings account, there is no minimum balance and no monthly fees. Capital One also offers CDs with terms ranging from six months to 60 months, and interest rates between 0.75% APY and 2.90% APY.

• Products Offered: Checking and savings accounts

• Minimum Balance Required: None

• APY on Best Account: 0.50% APY on the High Yield Chime Savings Account

• Monthly Fees: None

• ATM Network: 60,000+

If you’ve been unable to open a checking account because of either bad credit or an unsatisfactory relationship with a previous bank, Chime can help. You can open an account with no money, and no credit check. Chime also offers fee-free overdraft protection with their SpotMe program which provides you with up to $200 in overdraft spending.

Chime also offers other services to help you better manage your finances and even improve your credit. Their Credit Builder program offers a secure Visa credit card with no annual fees or interest that will report to all three major credit bureaus.

Chime, however, is on the low end of the interest scale, with their top rate being 0.50% APY on their High Yield Chime Savings Account. But Chime is more a banking app for individuals looking to build credit, and not about paying high interest.

• Products Offered: Checking, savings, and money market accounts, and CDs

• Minimum Balance Required: $1,000

• APY on Best Account: 3.45% APY on their 5-year CD

• Monthly Fees: None

• ATM Network: 85,000+

PenFed is a credit union offering complete banking services. That includes checking, savings, and money market accounts, as well as high-yield CDs, credit cards, auto loans, personal loans and lines of credit, student loans, and the full range of mortgages and home loan products.

Their CDs are where they’re strongest. That starts with their five-year certificate which currently pays 3.45% APY on balances as low as $1,000. Meanwhile, their Premium Online Savings is currently paying 0.75% APY with a minimum of $5 to open an account.

They also offer a free checking account with no minimum balance and no monthly fees, as well as their Access America checking account paying up to 0.15% APY on balances below $20,000, and 0.35% APY on higher balances. The account requires a monthly direct deposit of at least $500, or a minimum daily balance of $500 to avoid a $10 monthly fee.

• Products Offered: Checking, savings, and CDs

• Minimum Balance Required: Varies by account type and program

• APY on Best Account: N/A

• Monthly Fees: Waivable fees on checking accounts, none on savings

• ATM Network: 16,000+

There’s good news and bad news with Bank of America. Let’s start with the bad news—interest on their checking, savings, and CDs is downright dismal. We’re talking rates of below 0.10% across the board, even with the recent increase in interest rates in general. Bank of America is simply not an institution where you’ll want to hold a large amount of cash for the purpose of earning interest on your money.

But what Bank of America is good at is being a full-service bank. Unlike many of the other banks on this list, Bank of America is a traditional brick-and-mortar bank. They have more than 4,000 retail financial centers across the country, which means the possibility of face-to-face banking is very high. But like an increasing number of traditional banks, they also offer complete online banking services.

As a full-service bank, they offer several credit cards, home loan programs, auto loans, and investing through Merrill Edge. And if that’s not enough, they also offer small business banking and wealth management. Bank of America is the perfect choice if those are the services you’re looking for.

• Products Offered: Checking and money market accounts, and CDs

• Minimum Balance Required: None, but you must make a deposit within 60 days of opening your account

• APY on Best Account: 0.40% APY on Personal Money Market

• Monthly Fees: None

• ATM Network: 37,000+

NBKC is a small, Kansas City-based bank with just four brick-and-mortar branches in the Kansas City area. But they distinguish themselves as an online bank, and one that provides full banking services. That includes home loans, personal loans, auto loans, bridge loans, and credit cards, in addition to checking and money market accounts and CDs. If that’s not enough, they also offer business services, like funds, disbursements and payments, fraud management, collections, and cash management.

On the bank deposit side, they pay interest on both their money market and checking accounts. The Personal Money Market currently pays 0.40% APY on all account balances, has no minimum balance requirement, and charges no monthly fees. Their Everything (checking) Account pays 0.25% APY on all account balances, has no minimum deposit requirement, and no monthly fees.

CDs have terms of between three months and five years, with interest rates between 0.10% and 0.75% APY. Each requires a minimum investment of $1,000 or $250.

• Products Offered: Checking, savings, and money market accounts, and CDs

• Minimum Balance Required: Varies by account

• APY on Best Account: N/A

• Monthly Fees: Varies by account

• ATM Network: 9,500+

PNC is another brick-and-mortar bank with a strong online presence. It’s one of the largest regional banks in the country, and it provides full banking services to individuals and businesses. They offer checking and savings accounts, credit cards, home financing, auto loans, and retirement plans, as well as business banking services.

Much like Bank of America, as a large banking concern, interest rates paid by PNC on deposit accounts are poor. For example, they offer multiple savings accounts, all with interest rates well below 0.10% APY, regardless of account balance. The situation is much the same with their CDs, with terms ranging from as little as one month to as long as 10 years.

But if PNC has a distinguishing feature, it’s their Virtual Wallet. That’s a feature that combines checking and savings accounts with money management tools. It will set you up with the primary checking account representing your spending account, a secondary checking account that will act as a reserve, and then a long-term savings account for growth. It will then add digital tools to track your spending and automate your savings.

• Products Offered: Checking, cash reserve, and automated investing

• Minimum Balance Required: None

• APY on Best Account: 1.10% APY with Cash Reserve account

• Monthly Fees: None

• ATM Network: None, but fees charged by other financial institutions are reimbursed

Betterment is an online, automated investment platform, better known as a robo-advisor. For a small fee (generally 0.25% of your investment account balance) they’ll create, manage, and rebalance your investment portfolio for you. All you need to do is fund your account.

But as the company has expanded its product offerings, they now offer both checking and a high interest cash reserve account. The cash reserve account currently pays 1.10% APY with no minimum balance required, and no monthly fees. However, you must have a Betterment investment account to be able to take advantage of the cash reserve. Meanwhile, your account will enjoy FDIC insurance protection on balances up to $1 million, or $2 million in a joint account.

Betterment also offers no-fee checking, which comes with a Visa debit card. The account has no fees, and is FDIC insured up to $250,000 per depositor. The Visa card will give you an opportunity to earn rewards at participating merchants, and though Betterment has no ATM network, they do reimburse fees charged by other financial institutions, as well as foreign transaction fees.

Online Banking vs. Traditional Banking

In truth, the line between online banking and traditional banking is fast becoming a lot less obvious than it used to be. That’s because nearly every bank in the country, including long-established brick-and-mortar banks, now offers online banking. Not only is it a feature consumers commonly prefer, but it also enables banks to attract customers well beyond their home territory.

However, expanding customer reach is hardly the only reason banks offer online banking. Because online banking doesn’t require physical branches, or the employees needed to staff them, it reduces their cost of operation. By passing those lower costs along to their consumers, online banks are able to attract a larger customer base.

That’s a big reason why online banks typically pay higher interest on deposits than traditional banks and charge lower fees. Many in fact charge no standard fees at all, starting with the monthly service charge.

Another major difference between the two is that online banks are fully functional from their web platforms. That includes giving consumers the ability to check individual transactions; balance their accounts; pay loans, merchants, and vendors online; transfer money between accounts or even to third parties; and contact customer service.

Online banking has progressed to the point where it is now possible to take advantage of mobile check deposit capabilities, enabling you to immediately deposit a paper check in your account for immediate crediting. It’s even possible to apply for a loan or credit card through an online banking platform. The combination of services has become so sophisticated, it has virtually eliminated the need to visit a bank branch.

There’s one other feature that’s proven to be critical to the success of online banking, and it’s mobility. Consumers can now access their accounts and conduct their banking business on a computer at home or at work, or even through their mobile phones. That can turn a bank transaction that once took up to an hour into just five minutes.

Tips to Find the Best Online Bank

Banking is a very personal service, and you need to approach finding the right online bank with that thought in mind. Determine what your own personal needs and preferences are, then set about finding the bank that will best match what you’re looking for.

For example, if you have a need to deposit or access cash, the size of an online bank’s ATM network will be very important to you. A large fee-free ATM network will give you greater flexibility to conduct cash transactions.

If you frequently need customer service, you’ll want to work with an online bank that offers live customer support by phone or by live chat. Many online banks now offer live customer service on a 24/7 basis.

You should also consider the most important reasons you use your bank. For example, if you still write a lot of checks, you’ll want to work with a bank that will offer fee-free checking, with unlimited check writing. Focus on finding the best checking accounts. This is especially important because many online banks are gradually moving away from paper checks.

If you’re primarily interested in saving money and earning high interest, focus on the banks that pay the highest rates. This will include the banks with the best savings accounts and the best high-yield savings. If you’re saving for long-term purposes, and want to lock in high interest rates, look for banks offering the best CD rates. Or perhaps you’re interested in other services the bank may provide—like loans. For example, you may be interested in working with an online bank that offers personal loans, since they’re usually the prime choice for the best debt consolidation. Similarly, if you plan to buy a car in the near future, you may be interested in an online bank that offers favorable auto loans.

How We Found the Best Online Banks

We used very specific criteria to come up with this list of the best online banks. Below are the features we consider to be the most important in making that determination:

• Products Offered: At a minimum, we looked for checking and savings accounts, but also money market and CDs. Non-deposit features were also taken into consideration, such as credit cards, loans, and business banking.

• Minimum Balance Required: As you can tell from the banks included on this list, we’ve given a strong priority to banks that have no minimum initial deposit requirement, or ongoing balance requirements.

• APY on Best Account: Though most of the banks include a relatively small number of interest-bearing accounts, some offer many. For that reason, we chose to highlight the single account paying the highest rate of interest. And, generally speaking, if a bank pays a higher rate on one account, it follows through to the other accounts they offer.

• Monthly Fees: We absolutely favor the banks that charge no monthly fees. But we included a couple of larger banks that do have fees but waive them with very minimal requirements.

• ATM Network: Banking with an online bank usually means an absence of brick-and-mortar branches. That means ATM access becomes even more important as a source of cash. We favor the banks that have the largest fee-free network of ATMs or provide reimbursement for out-of-network fees.

We also consider other services offered by each bank. Betterment is an excellent example, since they provide automated investment services, while PNC offers their Virtual Wallet to help you better manage your money and build savings.

Information was taken primarily from each bank’s website, and also from independent bank reviews where necessary.

Summary of the Best Online Banks

Let’s wrap this up by giving you one last look at our list of the 11 best online banks and why we included each:

• Ally Bank: Best All-Around

• Discover Bank: Best Rewards Checking

• Alliant Credit Union: Best Online Credit Union

• CIT Bank: Best for High-Interest Savings

• Capital One Bank: Best Online Banking with Credit Cards

• Chime: Best for Depositors with Bad Credit

• PenFed: Best High Interest on CDs

• Bank of America: Best Full-Service Bank

• NBKC: Best Small Full-Service Online Bank

• PNC: Best Banking Virtual Wallet

• Betterment: Best Investment Service with Banking

Given that interest rates have been rising in recent months, we strongly recommend looking into one or more of these banks. That doesn’t mean you need to shift all your accounts over to one of them, but you should definitely consider moving your savings if you’re not currently earning a comparable rate of return. You can also check out our post on other high-yield investments.

FAQs – Best Online Banks

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