Best Online Banks in the U.S. | 2024
Almost two-thirds of Americans use online banking, and this figure is steadily increasing. The United States was the first country to open virtual banks in the mid-1990s. They are also called "internet banks", "digital banks", or "neobanks". To use the services of these companies, clients only need a smartphone or a PC with internet access. It is possible to open an online account in the United States in a matter of minutes and gain immediate access to a comprehensive range of traditional banking services, ranging from loans and investments to international transfers.
The main feature of U.S. internet banks is that they do not have physical branches, which greatly simplifies and expedites the receipt of necessary services. However, there is a problem of choice for someone who has never used the services of neobanks. There are ways to choose the best online bank in the U.S. for your needs. For example, consider which fees are acceptable, and which are considered excessively high. Is it worth paying for extra options? Looking for answers can take days or even weeks. To save you time, the Traders Union experts have prepared a guide with a detailed review of online U.S. banks with favorable terms.
Start Working with Digital Banks Now with the Wise Bank!What is an online bank in the U.S?
Such companies exist all over the world, and most of them are based in North America and Europe. They are acting as credit and financial organizations that provide internet banking services. Internet banking is a set of standard banking services (like savings accounts and transfers); plus, the latest options, for example, pots, and overdrafts. That is, any digital bank in the U.S. can do the same thing that a traditional bank does. The difference is that the virtual bank does not have physical branches.
Why is the absence of a branch advantageous? Because clients don't need to prepare a bunch of documents to obtain a loan. There is no need to go to the bank’s offices, stand in line, and talk to a manager for hours. All of the companies on the TU list of online banks in the U.S. widely apply automation technologies. Because the human factor is excluded, verification processes are quick. The maximum that is required from the user is to upload a scan of his identity document to pass the KYC verification.
Right now, 65.3% of U.S. citizens use online banking services. More than half of the remaining 34.7% are served by traditional banks, but regularly access one or more of their services via the internet. So, the number of neobank clients in the U.S. will continue to rise. Since these companies have a long list of advantages, the drawbacks (which are outlined below) are not critical.
Examples of online bank services in the U.S.:
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money transfers within the country and abroad;
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currency conversion on the account or during the transfer;
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savings, investments, and special accounts;
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lending and micro-lending (e.g., overdrafts);
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all services can be obtained online through the app.
👍 Advantages of digital banks:
•This is economically beneficial. Many U.S. internet banks do not charge a service subscription fee. Transaction fees are their primary source of income. But even if neobanks offer paid services, the prices are always lower than for equal services at traditional banks.
•All services are at hand. Not only the best online banks in the U.S., but all neobanks, in general, operate entirely remotely. If the user needs to send a copy of a document, this is also done through the smartphone app. Making a transfer, obtaining a loan, and paying for education are just a little part of the tasks that can be completed with a few taps on the screen.
•Absence of regional restrictions. Internet banking is available in most countries where the internet is available. The client can transfer money to a friend even while in the Arctic if there is a satellite internet connection. Versatility in the context of globalization is a conceptual requirement for a modern bank.
•Complete financial control. Applications of companies from the top list of online banks in the U.S. can aggregate a client’s income and expense data. Some neobanks allow users to link accounts from other banks. A user-friendly dashboard enables detailed management of a client’s finances.
•Capital growth tools. In most neobanks, users can open a savings account with a rate of 1.95% or higher. Some companies do not block deposits, so clients can make deposits and withdraw funds at any time.
•Compliance with international standards. The best online banks in the U.S. provide a wide range of possibilities that are important for a comfortable life in the modern world. When a user opens an account, he can, among other things, open sub-accounts, apply for loans, receive overdrafts, invest in securities, and so on.
•Responsive customer support. Most virtual banks have call centers, but they are usually unnecessary. Alternative methods of communication with customer support are email and live chats. Chats combine the work of bots and real specialists, resulting in a faster resolution of queries.
•The highest level of protection. Mobile applications of online banks use biometrics, access codes, and push notifications. The server side applies the latest cryptographic protection methods. This ensures the security of user funds and data.
👎 Disadvantages of digital banks:
•ATM withdrawal fees. Virtual banks in the U.S. do not have their own ATMs, so clients are forced to pay a fee when withdrawing funds from ATMs operated by other companies. Some neobanks enter into partnership agreements with networks like Allpoint, which allows free withdrawals in most situations.
•Difficulties with depositing via ATMs. The root of the problem remains the same: a lack of bank-owned ATMs. For this reason, some banks do not accept deposits in cash. Sometimes this is not possible, even via postal orders or by scanning a check. In this situation, the client can only make deposits into his account online.
•Lack of live communication. Some people prefer to see the manager in person and are uncomfortable speaking on the phone. Using the services of neobanks can be difficult for them because direct communication is not available.
List of online banks in the U.S. with the most favorable terms
At the moment, the full list of online banks in the U.S. includes more than 60 companies. These are officially registered credit and financial companies that provide internet banking services. They are trusted since they operate under the control of local or international regulators. Most of these companies are over two years old, and many are over ten. So, if you want to use internet banking services in the U.S., you will need to conduct extensive research through massive amounts of information. Only after you have completed this work will you be able to objectively choose the best neobank for you.
However, there is an alternative method. Experts at the Traders Union have already compared all of these companies and compiled a list of the best online banks in the United States. They are shown in the comparative table below. The table also includes the main parameters of the top banks, followed by a brief background on each. The Traders Union experts identified their features, pros, and cons, and compared them based on fees and the range of services provided. The information in this article is regularly updated.
| Online bank | Regulated in the U.S.? | U.S. dollar support | Loan rates | Service fees | |
|---|---|---|---|---|---|
Wise |
Yes |
Yes |
Individually (up to 6.40% on the mortgage) |
No |
|
SoFi |
Yes |
Yes |
From 7.99% |
No |
|
Revolut |
No (UK) |
Yes |
From 7.3% |
0-13.99 euros per month, depending on the plan |
|
Bunq |
No (Netherlands) |
Yes |
Individually (from 3.75%) |
0-17.99 euros per month, depending on the plan |
|
CIT Bank |
Yes |
Yes |
Individually (depends, among other things, on the client's credit score) |
No |
|
Axos Bank |
Yes |
Yes |
Individually (depending on the type of loan and credit score) |
No |
|
Ally Bank |
Yes |
Yes |
From 6.25% |
No |
|
Capital One |
Yes |
Yes |
Individually (depends, among other things, on the client's credit score) |
From $15 (free if the account balance is over $2,000) |
|
Discover |
Yes |
Yes |
Up to 24,99% |
No |
|
Varo |
Yes |
Yes |
Up to 23% |
No |
Most of the companies on the TU list of online banks in the U.S. do not charge a monthly fee. Those companies that have several plans usually offer, among other things, a free plan. Such plans are indicated in the "Service fee" column with "0" as the first digit in the price range. When it comes to loan rates, keep in mind that even where exact figures are specified, they are only representative. This is because all online banks in the U.S. calculate the loan individually. This process is influenced by many factors. Some banks have a loan calculator integrated into the website and the application.
Almost all online banks in the Traders Union's top 10 are regulated by U.S. authorities, usually the Federal Deposit Insurance Corporation (FDIC). The exceptions are Revolut and Bunq, which are controlled by UK and Dutch regulators, respectively. However, this is not a problem since Revolut and Bunq serve residents of the United States, observing regional legislation. In other words, all the listed digital banks in the U.S. are reliable and trustworthy. They support the holding of funds in U.S. dollars in the main account.
Wise
This is one of the best online banks in the U.S. and is also popular in Europe and Asia. Wise has earned its fame thanks to an extensive list of services and low fees for international transfers. The other charges are generally average or below average. There is a conversion function, and the main account can be used to store funds in various currencies, including the U.S. dollar. A virtual bank card is provided right after opening an account. If necessary, the client can order a physical card. Cash can be withdrawn from ATMs for free several times per month; after that, there is a fee of 1.75%, which is lower than that of many of its competitors.
👍 Pros:
•possibility of holding funds in 56 different currencies;
•Wise works with banks in 80 countries;
•no fees for transfers in the base currency;
•various types of accounts, flexible terms.
👎 Cons:
•no savings account available;
•the bank does not provide loans.
SoFi
The SoFi online bank appears on many lists of top banks because it offers the widest range of services in the sector of online banking and has low fees. New clients can take advantage of several interesting options. For example, there is a welcome bonus of $10 and an automatic credit score upgrade just for registration and verification. Users can open an investment account in addition to their main one for free and receive a block of stocks worth up to $1,000.
Unlike Wise, SoFi offers a wide range of loan solutions, including consumer loans, car loans, and loans for housing or study. Each program has its own terms and is beneficial in each particular case. There is also the possibility of refinancing an existing loan. SoFi savings accounts offer a rate of 3%, which is one of the best rates among virtual banks in the U.S. All clients benefit from a universal cash back of 3% on their favorite categories.
SoFi insurance solutions are another obvious advantage of this online bank. There is life and health insurance, as well as insurance for the client's home, car, or equipment. As with loans, each program is intended for a specific situation. Premiums are relatively low, while the amount of insurance is higher than the market average. These are just some of the features of SoFi, which in many ways is a reference digital bank.
👍 Pros:
•many loan and insurance solutions;
•several account types for private clients;
•high interest on savings accounts;
•fairly low commissions and fees.
👎 Cons:
•to get the best rate, the client must make a monthly deposit into his savings account.
•standard withdrawal fee is valid at affiliate network ATMs; other ATMs charge a higher fee.
Revolut
This is a well-known bank not only in the United States but also in many other countries, and it is closely monitored by reputable international regulators. The bank offers several types of accounts with flexible terms for private clients and businesses. Transfers within the country and abroad are among the fastest, while the fees are average or below average. There are all of the conventional functions that an online bank client in the United States might need, including loans for mortgages. Services are provided based on the plan chosen; there is also a free plan available. Revolut is recognized by experts as the most innovative internet bank.
👍 Pros:
•fast transfers to any country;
•currency conversion option;
•possibility of holding funds in different currencies;
•free ATM withdrawals.
👎 Cons:
•currency conversion fee;
•additional fee for operations with exotic currencies;
•the free plan has significant limits.
Bunq
A comprehensive review of U.S. online banks shows that Bunq is one of the oldest companies operating in the region. It was founded in 2012, and to date, there has not been a single situation in which Bunq violated the rights of clients or failed to fulfill its obligations to them. The activities of this neobank are transparent.
The client-oriented and technological nature of the company allows it to provide a wide range of basic functions and additional options across all segments of internet banking. For example, environmental protection is trending today, and every Bunq client can contribute. As soon as the client spends 100 euros (or the equivalent in dollars) from his account, the company plants one tree.
Many online banks in the United States, including Bunq, allow the opening of sub-accounts. A sub-account is an account in addition to the main one that allows the user to perform various tasks, for example, holding funds in a currency that is not supported by the main account. The sub-account expands the financial capabilities of the client.
👍 Pros:
•several types of accounts for private clients and businesses;
•almost every function can be flexibly customized;
•its mobile application is one of the most stable and convenient among its competitors;
•customer support has received the highest rating.
👎 Cons:
•strict limits on the free plan;
•Bunq charges fees that other banks do not.
CIT Bank
This digital bank works with residents of most countries, offering different account types for personal use and solving corporate tasks. The rate of 4.25% on a savings account was one of the reasons why TU experts included CIT Bank in its list of the best online banks in the U.S. This is one of the highest percentages, but there is a subtle point: the client must deposit at least $1,000; otherwise, the rate will drop to 3.25%.
CIT Bank offers quite a lot of specialized loan programs. For example, there is a consumer loan, a loan for the purchase of a home or a car, and a loan to pay for education. In every other way, this is a standard internet bank that allows users to store funds in various currencies, convert them, and transfer them to many countries. Among other features, the mobile application includes a convenient financial management dashboard.
👍 Pros:
•no subscription fee, only commissions;
•ATM fee refund option;
•several levels of interest rates.
👎 Cons:
•withdrawals at ATMs are always paid;
•customer support is not available 24/7.
Axos Bank
This is a favorable U.S. online bank with no minimum deposit requirements. The bank provided both standard and savings accounts. APY (annual percentage yield) starts at 1.25%; pensioners receive a savings allowance of 0.55%. Cash back is 1% on all purchases. Axos Bank has quite a lot of unique features that allow it to successfully compete with other neobanks, despite average parameters. There is access to the Money Market without a subscription fee. Also, users can profitably refinance a mortgage or obtain a new mortgage loan on affordable terms.
👍 Pros:
•no fee on savings accounts;
•several current account types;
•refund of cash withdrawal fees;
•one of the most convenient mobile applications.
👎 Cons:
•rates on savings accounts are quite low;
•ATM withdrawal fee.
Ally Bank
One of the most famous online banks in the U.S., founded in 2009. It offers several types of accounts, including current and savings accounts as well as deposit certificates. Besides this, users can benefit from a complete set of loan options – mortgage, car, study, or consumer. There are investment accounts and a special account for pensioners. One of the key advantages of this U.S. virtual bank is its partnership with Allpoint. This network includes 55,000 ATMs throughout the country where clients can withdraw funds for free. Ally Bank provides a refund of up to $10 per month for paid withdrawals at other ATMs.
👍 Pros:
•no subscription fee;
•no requirements for the account balance amount;
•the savings percentage rate is above average;
👎 Cons:
•the account can only be deposited online;
•high fees at ATMs not affiliated with the Allpoint network.
Capital One
It is considered one of the best online banks in the United States for increasing capital because it provides high-interest savings accounts under favorable terms (without blocking the deposit). There is an automatic increase in the client’s credit score, and the loan program can be tailored individually for a specific purpose. In addition to accounts for private clients, there are corporate and business accounts with the integration of automated solutions for taxation and the generation of standard reporting. The bank works with Allpoint and MoneyPass ATMs, providing over 70,000 free withdrawal points.
👍 Pros:
•no subscription fee;
•no overdraft fees;
•"smart" lending;
•high savings interest;
•24/7 customer support.
👎 Cons:
•high fees when withdrawing cash from ATMs not affiliated with the Allpoint and MoneyPass networks.
•concerns about the competence of customer support.
Discover
Discover Bank was included in the TU list of the best online banks in the U.S. due to compliance with modern standards and a favorable deposit rate. The company is regulated by the FDIC. The welcome bonus is $100, which is available after verification. There are additional bonuses ($150 and $200) when the client deposits a certain amount into his account. Discovery has several types of cash back cards, but note that the issuance of debit cards (both virtual and physical) is currently on hold. Like the two previous neobanks, this company also cooperates with the Allpoint network, which allows one to withdraw cash from affiliate ATMs for free.
👍 Pros:
•transparent and low fees;
•several account types, 1% cash back on all purchases;
•high savings rate;
•many ATMs with free withdrawals;
•no subscription fee.
👎 Cons:
•cash deposits into the account are not accepted;
•issuance of debit cards is currently suspended;
•high fees at ATMs not affiliated with the Allpoint network.
Varo
This neobank does not charge a subscription fee, and no minimum deposit is required. It works with Allpoint, so there is no fee for withdrawals from affiliated ATMs. Clients can deposit funds without paying a fee through the Green Dot Reload network, which has over 90,000 points across the country. Varo is frequently listed among the top online banks in the United States due to its savings account terms. The standard rate is 2%, but if the deposit is $1,000 or more, it can be increased to 5%. There are several options for automating financial operations, such as Save Your Pay, which allows a transfer from a check to be automatically repeated.
👍 Pros:
•no subscription fee;
•high APY rate;
•partnership with Allpoint;
•24/7 customer support;
•functional application.
👎 Cons:
•the savings account can only be opened if there is already an active current account;
•high fees if withdrawing cash from non-Allpoint ATMs.
Best online banks in the U.S. with low fees
A review of online banks in the United States reveals that they differ in many ways, even though some of their functions are very similar. In general, the main difference is not in the services themselves but in commissions and fees. When comparing the top online banks in the United States, most experts and users agree that fees are the most important group of parameters. Indeed, the higher the fee, the less favorable the bank is from the client's point of view. It may have an excellent rate on a savings account, integrated conversion, and perfect investment solutions, but any advantages do not look preferable when fees are high. The table below shows the best online banks in the U.S. in terms of fees.
| Online bank | Overdraft fee | ATM withdrawal fee | International transfer fee | International exchange fee |
|---|---|---|---|---|
Wise |
No |
1.75% (additional terms applied) |
0.3-3.5% |
From 0.3% |
SoFi |
No |
No, in Allpoint ATMs; $2.5 to $5 in other ATMs |
Individually |
0.2% |
Revolut |
No |
No up to six withdrawals, then 1.5 pounds |
From 0.5% |
From 2.5% |
Bunq |
No |
No, up to 250 euros per month, then 3% |
No |
3% |
CIT Bank |
No |
No in affiliate ATMs; 1% in other ATMs |
None or $35 per transfer (depends on the account type) |
Individually |
Ally Bank |
No |
No, in Allpoint ATMs; $2.5 to $5 in other ATMs |
Service is not provided |
1% |
Capital One |
No |
2% (+$3 abroad) |
Service is not provided |
No |
Discover |
$30 |
Individually |
$30 |
0% |
Axos Bank |
No |
5 free withdrawals at affiliate ATMs; 3 free withdrawals at other ATMs, then the fee depends on the bank that owns the ATM |
1% of the amount |
Individually |
Varo |
No |
$2.5 |
No |
No |
Best online banks in the U.S. with savings accounts
Varo
In most cases, neobanks offer a 2% interest rate to new clients. Further, it is possible to increase the percentage. For example, if the deposit is over $1,000, the rate automatically increases to 5%. This is a very high figure. Another important feature of this online U.S. bank is the automation of a savings account. For example, a user can set up automatic deposits and payments that will be credited at a predetermined time through specific payment methods. This approach significantly facilitates the life of the bank's client and allows him to get the maximum benefit from the capital increase program.
CIT Bank
This is another company that ranks among the best online banks in the United States, thanks in part to its savings rates. In fact, CIT Bank has very few competitors in this segment because the standard rate on a savings account starts at 3.25%. This in itself is quite a high rate, but the rate can be raised to 4.25% if the deposit is $1,000 or more. Note that the deposit is not blocked. This means that the client can make additional deposit payments or withdraw funds with interest recalculation at any time (although it is not recommended to do this under regular circumstances, because the profit will greatly decrease). It is also worth noting that CIT Bank is a regulated U.S. company whose activities are supervised by the FDIC, which guarantees the protection of deposits.
Best Digital Savings AccountsBest online banks in the U.S. for investing
SoFi
The number of U.S. virtual banks developing investment solutions is increasing every year. SoFi is one of the leaders in the industry because it has many products for increasing client capital. For example, using a mobile application, a client can buy securities (including dividend stocks), as well as IPOs (initial public offerings) and ETFs (exchange-traded funds). Everything is done with a couple of taps on the screen, but more importantly, SoFi does not charge fees for investment program transactions. This is one of the few digital banks in the U.S. that allows one to buy and sell cryptocurrencies through its mobile application (as of now, there are more than thirty cryptos to choose from). Plus, there are many options for full automation of investment operations.
Revolut
This bank offers a multi-currency account, and the user can open additional sub-accounts. Also, there is an integrated conversion function. In terms of investment solutions, it is one of the best online banks in the U.S. because it provides access to a variety of assets, including stocks, cryptocurrencies, and commodities. The client receives a whole list of tools for automating investments. For example, he can set a top price, and when the value of the asset reaches it, he receives an alert on his smartphone. The investment account is managed through a mobile application. Fees are fairly low, and the client can view detailed statistics with information on all operations.
FAQ
What is an online bank?
This is the definition of credit and financial companies that operate in the same way as traditional banks (officially and under license) but do not have physical branches. Other names of these companies include "virtual banks", "internet banks", or "digital banks".
Can virtual banks in the U.S. be trusted?
The Traders Union list of U.S. online banks includes all companies that are regulated by either official country authorities or competent international regulators. The Federal Deposit Insurance Corporation (FDIC) is an example of an American regulator, while the UK Financial Services Authority (FSA) is an example of a foreign regulator. It does not matter which body controls the virtual bank. If it is controlled, therefore, it is reliable.
How are digital banks in the U.S. better than traditional banks?
Their key feature is that they do not have physical branches. This means that clients are not required to prepare numerous documents, go to a particular place, wait in lines, or have long conversations with managers. It is sufficient to have a smartphone with internet access; the user simply downloads the online bank application, registers, and receives a full range of banking services. Their ordering takes minimal time.
What are the disadvantages of the best online banks in the U.S.?
The main drawback is the lack of their own ATMs, so withdrawals may be subject to a fee, and depositing is not always possible. However, a review of U.S. online banks shows that many of them work with the Allpoint network, and their clients can benefit from free cash withdrawals at affiliate ATMs.
Glossary for novice traders
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1
Broker
A broker is a legal entity or individual that performs as an intermediary when making trades in the financial markets. Private investors cannot trade without a broker, since only brokers can execute trades on the exchanges.
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2
Index
Index in trading is the measure of the performance of a group of stocks, which can include the assets and securities in it.
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3
Yield
Yield refers to the earnings or income derived from an investment. It mirrors the returns generated by owning assets such as stocks, bonds, or other financial instruments.
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4
Extra
Xetra is a German Stock Exchange trading system that the Frankfurt Stock Exchange operates. Deutsche Börse is the parent company of the Frankfurt Stock Exchange.
Team that worked on the article
Oleg Tkachenko is an economic analyst and risk manager having more than 14 years of experience in working with systemically important banks, investment companies, and analytical platforms. He has been a Traders Union analyst since 2018. His primary specialties are analysis and prediction of price tendencies in the Forex, stock, commodity, and cryptocurrency markets, as well as the development of trading strategies and individual risk management systems. He also analyzes nonstandard investing markets and studies trading psychology.
Olga Shendetskaya has been a part of the Traders Union team as an author, editor and proofreader since 2017. Since 2020, Shendetskaya has been the assistant chief editor of the website of Traders Union, an international association of traders. She has over 10 years of experience of working with economic and financial texts. In the period of 2017-2020, Olga has worked as a journalist and editor of laftNews news agency, economic and financial news sections. At the moment, Olga is a part of the team of top industry experts involved in creation of educational articles in finance and investment, overseeing their writing and publication on the Traders Union website.