Online banks offer 10-20x higher interest rates than traditional banks, with no monthly fees. This guide compares the best online banks for savings, checking, and complete banking needs.
Top Picks 2025
- Best Overall: Ally Bank (great rates, full service)
- Highest Savings APY: UFB Direct (5.25% APY)
- Best Checking: Discover (1% cashback on debit)
- Best for CDs: Marcus by Goldman Sachs
- Best Mobile App: Chime (early direct deposit)
Best Online Savings Accounts
| Bank | APY | Min Balance | Monthly Fee | Rating |
|---|---|---|---|---|
| UFB Direct | 5.25% | $0 | $0 | |
| Bread Savings | 5.15% | $100 | $0 | |
| LendingClub | 5.00% | $0 | $0 | |
| Ally Bank | 4.25% | $0 | $0 | |
| Marcus | 4.40% | $0 | $0 | |
| Discover | 4.25% | $0 | $0 |
Best Online Banks Reviews
BEST OVERALL
Ally Bank
Why we love it: Complete banking solution with great rates, no fees, and excellent customer service. The gold standard for online banking.
- Savings APY: 4.25%
- Checking: 0.10-0.25% APY, no fees
- ATM access: 43,000+ fee-free ATMs (Allpoint)
- Features: Buckets for savings goals, round-up transfers
- CDs: Competitive rates, no early withdrawal penalty options
HIGHEST APY
UFB Direct
Why we love it: Consistently among the highest savings rates available. Simple, no-frills approach to earning more.
- Savings APY: 5.25%
- Minimum balance: $0
- Monthly fee: $0
- FDIC insured: Yes
BEST CHECKING
Discover Bank
Why we love it: Only major bank offering 1% cashback on debit card purchases. Great for everyday spending.
- Cashback checking: 1% on up to $3,000/month in debit purchases
- Savings APY: 4.25%
- ATM access: 60,000+ fee-free ATMs
- Monthly fee: $0
Online vs. Traditional Banks
| Feature | Online Banks | Traditional Banks |
|---|---|---|
| Savings APY | 4-5%+ | 0.01-0.50% |
| Monthly fees | Usually $0 | $5-15+ common |
| ATM access | Network ATMs | Own + network ATMs |
| Branch access | None | Yes |
| Cash deposits | Limited options | Easy at branch |
| Customer service | Phone/chat | In-person available |
How Much More Can You Earn?
Interest Earnings Comparison
On $10,000 savings for 1 year:
- Traditional bank (0.05% APY): $5
- Online bank (4.50% APY): $450
- Difference: $445 more per year!
On $50,000 for 5 years (compounded):
- Traditional bank: ~$125 earned
- Online bank: ~$12,300 earned
Best CDs (Certificates of Deposit)
| Bank | 6-Month | 1-Year | 5-Year | Min Deposit |
|---|---|---|---|---|
| Marcus | 5.10% | 4.60% | 4.00% | $500 |
| Ally | 4.50% | 4.25% | 3.75% | $0 |
| Discover | 4.40% | 4.25% | 3.80% | $2,500 |
| Capital One | 4.50% | 4.30% | 3.80% | $0 |
Choosing the Right Online Bank
- Check APY rates: Higher is better (compare current rates)
- Verify FDIC insurance: Your money is protected up to $250,000
- Review fees: Most should be $0
- Check ATM network: Allpoint (43,000+) or MoneyPass
- Consider your needs: Savings only? Full banking?
- Read reviews: Customer service quality matters
Online Banking Safety Tips
- Verify FDIC insurance: Check at FDIC.gov
- Use strong passwords: Unique to banking
- Enable 2FA: Two-factor authentication
- Monitor accounts: Set up alerts for transactions
- Use official apps: Download from official sources
- Avoid public WiFi: For banking transactions
Common Online Banking Features
- Mobile check deposit: Deposit checks via phone camera
- Zelle: Free instant money transfers
- Bill pay: Pay bills online for free
- External transfers: Link other bank accounts
- Savings goals: Organize savings by purpose
- Round-up savings: Round purchases to save spare change